Just over the border of northeast Washington in British Columbia, Canada, there is a mining area that was once a national force even though it was highly fragmented and never underwent any modern exploration techniques.
First discovered in the 1890's, nearly 800,000 ounces of gold at a stunning average grade of 14.4 g/t gold were historically produced from the Sheep Creek Gold District in what is known as the Kootenay Arc region. Margaux Resources (TSX-V:MRL)(OTCQB:MARFF) has no doubt that there is still a lot of metal in the ground, albeit gold or zinc and the company has spent the last year or so acquiring and combing the land into a 24,000-hectare (mostly contiguous) portfolio to prove its contention. That land package includes about 96% of the Sheep Creek Gold District by area.
After collecting historic data and undertaking a 3D computer modeling project at Sheep Creek, Margaux is ready to start drilling, with a 6,000-metre diamond drilling plan consisting of 25 drill holes disclosed on Monday.
Leveraging historic data and exploration work completed in the last year, Margaux has honed in on some areas to sink drill bits, including the Ore Hill area at Sheep Creek where grab sample assays ranged as high as 119 g/t (and 0.90% lead and 3.41% zinc) and 105 grams per tonne gold. Other samples returned values up to 22.8% zinc.
Ore Hill is a known gold anomaly about 1,500 metres long by 150 metres wide. Margaux management says the plan is to start the 6,000-metre drill program next month. Further, a ground geophysical survey is planned for this year to better define additional drill targets.
Toronto-listed shares of Margaux are typically thinly traded and have dropped 16.7% Monday morning to 20 cents each on only 15,000 in volume. That equates to a market cap of $12.05 million, according to Quote Media data.
U.S.-listed shares trade at quite a wide discrepancy to its Toronto counterpart, holding at 6.4 cents for a market cap of $3.85 million.
