ECR Minerals’ strong run continues following news of major R&D refund (ECR)

Precious metals explorer ECR Minerals (LSE:ECR) jumped 13.8pc to a nine-month high of 0.98p on Tuesday after announcing that it had received a significant payment from the Australian government. The £4.3m firm said its subsidiary Mercator Gold has received a cash research and development refund of c.£171,000 under the R&D Tax Incentive from the Department of Industry, Innovation, and Science. The money relates to qualifying expenses incurred by Mercator in the year ended 30 June 2018.

Furthermore, Mercator is entitled to submit another claim for the year ended 30 June 2019. Based on current, estimated qualifying expenditure, ECR believes its application for the current period will hit around £198,000, which it expects to receive in August. Elsewhere, ECR announced that Mercator has also carried forward corporate income tax losses of c.£35.5m in its tax return for the year ended 30 June 2018.

ECR’s chief executive Craig Brown said the R&D refund would supplement its existing cash resources and be applied to its active gold exploration programmes in Australia.

‘We are grateful for the immense support offered by the Australian Government which we believe demonstrates the attractiveness of Australia as a destination for investment in exploration and development projects,’ he added. ‘As a result of Government support, the Company’s cash resources are bolstered, enabling it to maintain a considerable and active exploration programme.’

The refund continues an active couple of weeks for ECR, which entered May at 0.7p a share. Last Wednesday, the company soared by 49.23pc after announced that its Creswick gold project in Victoria, Australia may be much more prospective than previously thought.

To date, the firm has carried out 1,687m of RC drilling in 17 holes at Creswick targeting multiple quartz vein orientations within a 15km-long hard rock geological feature called the Dimocks Main Shale (DMS). More than one-third of its drilled area has encountered quartz, including a zone exceeding 60m in width - more than twice the 25m width expected. Meanwhile, the business has met gold in all of the holes it has drilled so far, with grades in nine holes ranging from 0.6g/t to a whopping 44.63g/t.

Critically, a technical review of the programme and its assay results - which has nearly completed - has confirmed that the mineralisation is ‘nuggety’ in nature. The discovery that gold within the DMS is nuggety is also important because such a style of mineralisation can lead to understated assay results. This is because the chance that a gold nugget will be captured in a drilled meter decreases as the nugget increases in size. Likewise, only a small portion of each RC drilling sample bag is actually tested, meaning results could be understated if one or more large nugget is not included in the examined portion.

That being said - as ECR pointed out - this could also lead to results being overstated if a large nugget is captured in the small tested portion that does not accurately represent the sample bag as a whole.

To fix this issue, the business has resolved to complete gravity concentration tests on entire sample bags for all of its drilling to date. This new approach is already reaping rewards for the organisation, with a nugget being identified in a previously untested portion of a sample bag from hole CSR011. All-in-all, the whole bag has demonstrated gold grades of 11.8g/t from the new gravity concentration tests - some 528pc higher than the previous 1.88g/t assay result.

The firm ended said it believes there is potential for a ‘very substantial gold deposit’ within the DMS, with Brown adding that the extensive footprint gold system at Creswick offers ‘transformational potential’.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has been paid to produce this piece by the company or companies mentioned above.

Catalyst Information Services Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance.

ECR Minerals makes new gold discovery at Blue Moon deposit (ECR)

On Wednesday, ECR Minerals (LSE:ECR) announced a new gold discovery at its Blue Moon deposit in Victoria, Australia. ECR has just completed a follow-up reverse circulation drilling campaign at the deposit which is located within the firm’s Bailieston gold project. Twelve holes were completed for 1,718 metres drilled and significant intersections of gold mineralisation were made in nine of the holes. The results included a standout 2 metres at 17.87 grams per tonne (g/t) of gold within a zone of 15 metres at 3.81 g/t gold from 51 metres. The addition of these positive results to previous exploration at the deposit presents Blue Moon with the status of a new gold discovery.

The highest grades were found in the westerly section where the company hopes to carry out further exploration. ECR will need the consent of the landowners to further pursue the identified system to the west and initial exploration would comprise of surface geochemical sampling first, with the possibility of further drilling to follow. 

The Bailieston gold project is located around 30km east of the Fosterville gold mine which is currently the largest producing gold mine in Victoria, producing around 300,000 ounces of gold per annum. Another active mine, called Costerfield, can be found about the same distance to the south-west – it currently produces around 50,000 ounces of gold per year. The Blue Moon prospect shares analogous properties with the Fosterville mine.

A map showing the location of all drill holes completed at Blue Moon

 

Craig Brown, Chief Executive Officer of ECR Minerals plc, commented:

“I am pleased to announce the complete results of the RC drilling programme undertaken at the Blue Moon prospect and the new gold discovery we have now confirmed.

Within this follow-up programme, we have reported gold grades of up to 17.87 g/t gold over 2 metres from 57 metres and have significantly increased our knowledge of the geology at Blue Moon. This represents considerable advancement when set against the diamond drilling results reported in July 2018 from the first three holes at Blue Moon, which included a significant intersection of 39 metres at 0.3 g/t gold from 24.2 metres.

With the knowledge gained from the RC programme we believe that the gold mineralisation intensifies further west and now have a clear action plan to follow the system. We are excited by the findings and will continue our work at Blue Moon and other prospects in the Bailieston project area, with our strategic objective remaining a multi-million ounce gold discovery.”

Author: Stuart Langelaan

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has been paid to produce this piece by the company or companies mentioned above.

Catalyst Information Services Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.