QPM Discovers New High-Grade Gold Zone Near La Pointe Extension
This week Quebec Precious Metals Corporation (TSXV: QPM | OTCQB: CJCFF) released four drill results from its current 19-hole Summer and Fall drill program at its flagship Sakami project in the James Bay region of northern Quebec.
The Sakami project includes the La Pointe Deposit and La Pointe Extension discovery that are part of a 2 kilometre long mineralized trend. The project is very large, comprising 259 claims over 13,110 hectares (over 32,000 acres).
Drilling was focused on La Pointe Extension and returned a high-grade, highlight hole (PT-20-173) of 60.8 grams per tonne gold (g/t Au) over 0.3 metres within a band of 1.4 metres at 15.01 g/t Au. Photo 1 shows the visible gold in the PT-20-173 core sample.
PHOTO 1: Visible gold from the Diamond Drill Hole PT-20-173 – Sampled at 60.8 g/t Au over 0.3 metres
Drill hole PT-20-173 intersected a new high-grade zone that was 110 metres northwest of the La Pointe Extension discovery that was press released on April 21, 2020.
Normand Champigny, CEO of QPM, remarked: “It is very encouraging to discover a new and high grade zone at La Pointe Extension. This high grade intercept of 60.8 g/t Au over 0.3 m shows that other high grade zones are likely to be encountered as we continue to drill in 2021.”
During the current drill program, a total of 4,912 metres in 19 holes were completed with results from five holes still pending.
Maiden Resource Expected in 2021
The main focus of the drill program was to advance the Sakami gold project to a resource estimate stage in the first half of 2021. The Company is aiming for a resource of 2 million gold ounces, which would value the company at Enterprise Value per gold ounce (EV/oz) of US$4.00, very low amongst its peers. Recent M&A deals in the gold exploration space, valued companies in the US$40-US$120/oz range.
The drill program also aimed to expand and further define the 600 metres of mineralized strike length that was discovered during the 2020 winter exploration program. The drilling results indicate that gold-bearing mineralization at the La Pointe Deposit and at La Pointe Extension discovery has a similar geological characteristics.
Sakami Project Defined by Long Mineralized Intercepts
Earlier results from the La Pointe Extension drill program this year delivered very long mineralized intercepts including:
- PT-20-151: 80.1m at 1.15 g/t Au
- PT-20-159: 80.0m at 1.10 g/t Au
- PT-20-154: 70.3m at 1.14 g/t Au
- PT-20-155: 53.8m at 1.03 g/t Au
- PT-20-162: 42.0m at 1.31 g/t Au
- PT-20-153: 35.4m at 1.45 g/t Au
And complimented the long intercepts from previous years’ drill programs, including:
- PT-16-91: 64.5m at 1.62 g/t Au
- EX-10: 54.7m at 2.51 g/t Au
- PT-16-92: 48.6m at 2.52 g/t Au
- PT-14-79: 48.2m at 2.51 g/t Au
- PT-15-84: 48.5m at 1.34 g/t Au
Long intercepts can be important when calculating resource estimates as well as making a project more economic with a higher ratio of ore to waste rock.
Solid Project Infrastructure
The Sakami project is located 570 kilometres north of Val d’Or, Quebec, 90 kilometres from the Éléonore gold Mine, owned by Newmont Corporation (NYSE: NEM | TSX: NGT), and 47 kilometres northeast of the paved James Bay Road.
Drilling can be carried out year-round and the site has good infrastructure including major access roads, a hydro-powered electric grid, and nearby airports.
Other Regional Projects
QPM also controls (100%) the Elmer East Project, a new gold and base metals system, also in Quebec’s James Bay territory, that is located east of Azimut Exploration’s recent Patwon gold discovery.
Undervalued Compared to Regional Peers
At an Enterprise Valuation (“EV”) of $10.1 million, we believe that QPM is undervalued compared to its regional peers including Azimut Exploration with an EV of $58.0 million and Sirios Resources (TSXV: SOI) with an EV of $26.6 million.
Upcoming Catalysts Should Help Buoy Stock
Upcoming catalysts include:
- Drill results from the final 5 holes from the 2020 Summer & Fall drill program;
- Announcement of the 2021 Winter drill program;
- Metallurgical testing results from rock samples to assess the overall gold recovery that are expected during the winter of 2021; and,
- Maiden resource on the Sakami gold project expected during the first half of 2021 and QPM is aiming for a resource of 2 million gold ounces.
MAP 1: Sakami Project Location in the Lower James Bay Region of Quebec
Chris Thompson, CFA, MBA, P.Eng is the President & Director of Research at eResearch Corp. and a Sr. Editor and Director for InvestorIntel Corp. Chris ... <Read more about Chris Thompson>