Armadale Capital (LON:ACP) said drilling had started at the flagship Mpokoto gold project in DRC in a bid to unlock further value from the site.
The work is aimed at expanding the existing known resource of 507,000 ounces of gold. The site has an exploration target of 10- 15 million tonnes at 1.2g/t-1.5g/t of the yellow metal.
Director Justin Lewis told investors: “Mpokoto has already proven its value as a low cost gold project, boasting highly attractive returns and near term production potential and I am confident that this exploration programme will further unlock the project’s inherent value.
"Our primary goal is to commence commercial gold production before the end of 2015 and with results expected from Stage 2 of the Scoping Study, together with drill results, during the next quarter, we are looking forward to consecutive valuation events.”
A phase 1 scoping study for Mpokoto indicated a US$33mln post-tax net present value based on a gold price of US$1,250 per ounce.
The drilling consists of two programmes. A 2,400metre programme over 50 holes is aimed at increasing the resource estimate - in particular the oxide resource, which was the subject of the first scoping study.
It also aims to raise some areas of inferred resource to the higher confidence indicated category.
Meanwhile, additional augur drilling at shallow depth is expected to provide further samples of the shallow oxide ore, which is expected to support the first five years of gold production at Mpokoto.