Canadian exploration company Durango Resources (TSX-V: DGO; OTCQB: ATOXF; Frankfurt: 86A1) is heading north as drilling for gold ramps up in the prolific Windfall Lakes district and the possibility of good results get retail investors excited.
If you are an investor and into gold, the Abitibi and Urban Barry Greenstone Belts in Canada should be on your radar screen. The Abitibi straddles the border between Ontario and Quebec in eastern Canada and represents one of the largest and best-preserved Neoarchean Greenstone Belts in the world. The 135km long Urban Barry belt is part of the Abitibi sub province that trends east-west and is dominated by mixed mafic to felsic rocks with lesser fine-grained clastic sedimentary sequences.
At the heart of this prolific mining province, lies the historic city of Val d’Or (French for “Valley of Gold”), whose population of 32,491 inhabitants have, over the years, seen more than their fair share of explorers trotting through town and kicking up dust on Route 117. Since the 1930s the Val d’Or, Cadillac and Malartic camps in this region, have produced upwards of 45 million ounces of gold, and are presently home to seven producing gold mines, and one major mine development project.
The Abitibi Greenstone Belt has a long history of exploration and mine production, most of it profitable. Like Urban Barry, it trends in an east-west direction for almost 650km and is 150km wide. The 2800-million-year-old belt runs from west of Timmins, Ontario, to Chibougamau, Quebec. In 2006 there were close to 40 gold deposits in the world with more than 10 million ounces of gold, five of them, Hollinger-McIntyre, Kirkland Lake, Dome, Kerr Addison, and Horne Mines, are in the Abitibi. Also located in the Abitibi are the world- famous Campbell Red Lake – Goldcorp and Hemlo Mines.
All eyes on Windfall Camp
Recently, there has been a lot of focus on Windfall Lake, about 200km north of Val d’Or, in the Urban Barry Greenstone Belt, where a lot of exploration drilling has been taking place, and some great results have been made public. Although gold has not been mined so much in the vicinity of Val d’Or lately as it has in the past (as lead and copper becomes easier to mine) the yellow metal has certainly not lost its allure on the markets, and is not expected to do so soon, not in the next 10 years or so, anyway. With the world economy still in recovery mode after a pandemic onslaught, gold has remained solid as a rock.
Gold is still the darling of precious metals and, despite recent volatility, remains in demand. In fact, to put it into context, between 2009 and 2019 the demand for gold never fell below 4,000 tonnes per year until the outbreak of Covid-19 caused this demand to momentarily drop to 3,759.6t. Only one year later demand for gold continues to hover near record highs spurred on by a 10-year gold-buying binge by the world’s central banks. Central bank gold buying is at a 50-year high, exceeding 500 tonnes per year.
China still produces the most of the world’s gold (383.2t) while Canada, notwithstanding the slight decrease in production in 2019, has held the number five spot for three years running with an annual output of 182.9t. Canada’s gold production is estimated to reach 7.6 million ounces by 2023. In 2019, Ontario and Quebec accounted for almost 75% of that production, and the biggest chunk of that gold are unearthed from Abitibi.
The upside at Windfall
As demand for gold is set to increase and as more capital is directed towards junior mining companies and greenfield exploration, it is not a bad idea to go looking for exciting new gold projects with upside in a known, low-risk mining jurisdiction. Global uncertainty still reigns supreme as the Covid-19 vaccination roll-out struggles to make an impact, and while interest rates are low, gold is where you want to be, and Windfall Lake looks promising.
The Windfall Camp is famous for high-grade gold projects and there are currently three main players: Osisko Mining, Bonterra Resources and Durango Resources. Of the three, Durango seems to be holding all the aces. Its land area is nested neatly between that of Osisko and Bonterra’s, positioning it as a strategic takeover target. Durango is no stranger to the Windfall camp and has been exploring the area there since early 2011. All three projects share similar mineralization and structural geology and if drilling by Osisko and Bonterra is anything to go by, positive results from Durango will add to the entire Windfall areas pot of gold. Durango’s neighbours have collectively proven over 7 million ounces of inferred and indicated gold resources. Durango has just started to release results from its drill targets, which is barely meters away from that of Osisko’s.
In November 2017 Durango managed to obtain 50 till/soil samples from its northern blocks which lies adjacent to that of Osisko’s. These claims were deemed priority due to being cut by crosscutting fault systems striking toward the Windfall Lake main mineralized system.
Thirty-six five-kilogram till and 36 duplicate soil samples were collected, analyzed for fine-fraction analysis, and sampled for gold grain count and dense fraction. Of the 36 till samples taken from the area, 17 samples, (47% of the samples collected), returned gold grains, and 25 till samples of the multi-element assays reported gold anomalies between five ppb (parts per billion) and 3,480 ppb, (representing 74% of the samples collected).
A duplicate of heavy mineral concentrate for each till sample for each station was sent for a complete 36-element assay analysis. Twenty-five of the 36 samples returned anomalous gold values and 15 of the samples returned values of between five ppb and 100 ppb gold. The highest returned gold anomalies from the analysis were 3,480 ppb Au (sample DGT-30), 1,160 ppb Au (sample DGT-17), 425 ppb Au (sample DGT-18), 305 ppb Au (sample DGT-27), 160 ppb (sample DGT-26) and 121 ppb (samples DGT-10 and DGT-8).
Further Reading
Further upside potential at Windfall Lake
Durango is a golden opportunity
Overall, Durango’s share price has been on a positive path which proves that its early results have created some excitement amongst retail investors, and the prospect of further significant discoveries should have any potential investors licking their lips. At CA$0.08, Durango certainly draws the attention, especially for new entrants into the gold market. Apart from the upward trending share price and upside potential based on what its neighbours have drilled out, there are other factors that makes Durango a well-rounded company, and a golden opportunity for investors that should not be missed. All the companies’ properties are easily accessible via a gravel road that originates from Lebel Sur-Quevillon. The properties are traversed by many secondary logging roads which facilitate access to the areas for future exploration work. Furthermore, the all- female led executive team is confident in making strategic decisions and hunting for high value opportunities with lots of blue-sky potential at bargain prices. According to Marcy Kiesman, CEO at Durango, the company has been extremely successful stalking and acquiring strategically located mining projects with structural geology at bargain prices. “One could say that property hunting is our skill set,” says Kiesman. Technical chairman Dale Ginn is no stranger to significant new gold discoveries. Gill recently made 6 gold discoveries, including the nearby Gladiator deposit owned by Bonterra Resources. Of course, Durango’s land position makes it vulnerable to a take-over, but that counts in its favour, as both its neighbours seeks to expand their footprint.
It is thus strategically located to call the shots, not a position many junior mining companies often find themselves in. The till sampling program mentioned above returned 42 pristine gold grains with reported values above 2.1g/t Au. Results from the current drill program is expected soon, which will have investors watching the proceedings carefully. Over 2,000 assays are currently being analyzed. Durango has identified 15 high priority targets on its Trove Property to be drilled and furthermore, is actively drilling 2 exploration holes on the east Barry Property to confirm 2.19g/t in the till. Three key exploration programs are underway. The Orientation drill program, which started in January and is expected to be complete in April this year, will cost about CA$1-million, while the Advanced Investigation (Delimination Drilling) programme is earmarked to finish early in 2022 at a cost of about CA$5-million. A third program, the Definition Drill Program, will run at a cost estimate of about CA$7-million and will finish a little later than the Advanced Investigation in 2022.
With the outlook for gold remaining good and the first stage of drilling at Durango’s Windfall almost complete, this historic and prolific gold producing region can start looking forward to another, at least, three solid gold mining projects in the near future. While uncertainty and volatility are still the only constants, early-stage exploration companies with heaps of upside potential like Durango (TSX.V:DGO), offers immense value for prudent and strategic investors.
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