Roscan Gold extends strike at Kandiole project in Mali

“The positive results obtained beneath the existing K3 pit shell, within the fresh rock, are particularly encouraging as they suggest the presence of a larger mineralized system,” Nana Sangmuah, Roscan’s president and CEO, stated in a news release on Tuesday.

Kabaya remains open at depth and laterally, and is part of Roscan’s Kandiole project near Mali’s borders with Senegal and Guinea. The project is about 25 km east of B2Gold’s (TSX: BTO; NYSE-AM: BTG) Fekola mine and within an 80-km radius of seven operating mines, including Barrick Gold’s (TSX: ABX; NYSE: GOLD) Loulo-Gounkoto mining complex, about 35 km to the north.

Highlights from 12 reverse circulation drill holes include 1.62 grams gold per tonne over 24 metres starting from 26 metres in drill hole RCDBS22-0134b, including 3.36 grams gold over 5 metres; 2.27 grams gold over 7 metres from 27 metres downhole in RCDBX22-0136 including 7.12 grams gold over 1 metre; and 31.37 grams gold over 1 metre from 137 metres in drill hole RCDBS23-0147.

The drilling at Kabaya totalled 1,963 metres. Four of the 12 holes failed to return significant values and true widths are still unknown, noted Echelon Capital Markets analyst Ryan Walker, but overall, the program’s results were “directionally positive.”

“In all, the broader intervals in today’s results yield a weighted average grade of 1.3 grams gold per tonne over an average interval of 5.2 metres,” he commented in a research note to clients.

“By comparison, Kabaya hosts indicated resources of 197,000 oz. at 0.9 gram gold per tonne, with 28,000 oz. at 0.8 gram gold… in inferred resources. Combined the KB1-KB2 and KB3 zones strike for a combined 1.8 km, with a width ranging from 100-150 metres and extending to depths of 150-250 metres at KB2.”

Roscan acquired the Kabaya deposit in July 2020 and the target depicts the magnetic structure extension of 15 km into the company’s Mankouke West land package, the company says.

At midday in Toronto, Roscan’s shares were trading at 16.5¢ within a 52-week range of 14.5¢ and 34.5¢. The junior explorer has about 379 million common shares outstanding for a market cap of roughly $62.5 million.

Walker of Echelon Capital Markets has a target price of $1.00 per share and a speculative buy rating on the stock. “Our target is based on an insitu valuation of what we believe represents a potential multi-million oz. mineral inventory at Kandiole,” he wrote, and the project’s location near seven operating mines.

The analyst also noted that B2Gold acquired Oklo Resources, “Roscan’s neighbour”, in September 2022 in a cash and share deal that valued the company at A$91.3 million ($80.2 million) “or about US$90 per ounce for 668,000 oz. in measured and indicated resources.” “Roscan currently trades at an EV/oz. [enterprise value per oz.] of about US$41/oz., compared with the peer exploration/development company near peak average of about US$35 per ounce.”