Through a news release published on its website this week Thursday July 6, Iamgold Corporation (IAG, Financial) provided the market with the results of the last stream of drilling holes following its project on the Monster Lake, which is located in the Canadian province of Quebec. The site object of exploration activities is at a distance of about 50 kilometres southwest of the city Chibougamau.
This stream of drilling results represents an update of the previous 11 drilling holes the exploration team did on the area during the winter.
With the final stream of fourteen holes which equates to a total of more than 5,400 metres sampling, Iamgold has completed an exploration of the Monster Lake project consisting of a total of 10,657 metres for 25 diamond drill holes in total.
The exploration activities continued in returning very encouraging results practically from the entire 3 km long structural corridor, which is composed by the Megan Zone and the two additional zones. The lower Shear zone located southwest and the Annie Shear zone located northeast of the Megan zone.
At the Main Shear Zone, the exploration team uncovered a gold deposit of valuable mineral – grading 67.42 grams of gold per tonne of ore - at 3.5 meters, with a richer strike of ore localized over a subspace of 1.2 meters in the wider part of the mineralized area. The latter is characterized by the existence of peaks of amazing gold concentration in the mineral: till 203.31 grams of the yellow metal per tonne of mineral.
From hole number ML17-198B, which was also made at the central zone of the structural corridor, the team found a valuable presence of metal at 5 meters with a concentration of 80.28 grams of gold per tonne of mineral. The richest strike is characterized by a gold concentration of 208.41 grams of gold per tonne of mineral.
Very promising results for a potential source of valuable mineral deposit also came from the lower shear zone. Just to indicate one result: concentration of 39.48 grams of gold per tonne of ore was found at 1.6 meters, including a richer subspace at 0.9 meters – in the wider part of the mineralized zone – grading 66.650 grams of gold per tonne.
The exploration program will go on with further drilling activities in the area during summer season, which results - the company says - “may lead to the completion of an initial mineral resource estimate by yearend.”
This may have a significant impact on the market value of the stock.
In addition, the area is already well served by the existence of communications and a power grid for the needs of future mining activities. This means that building a gold producing asset at Monster Lake will require the employment of a low amount of financial resources.
Iamgold closed week 27 at $4.92 per share. The gold stock is down trending since the beginning of June, however, it gained 27.8% year to date.
Iamgold has a price-earnings (P/E) ratio of -111.82, a price-book (P/B) ratio of 1.02, a price-sales (P/S) ratio of 2.11 and an EV/Ebitda ratio of 6.80.
For Iamgold, the average target price per share is $6.17. The recommendation rating is currently 2.6 out of five. Iamgold has an EVO – enterprise value to the total volume of mineral reserves (ounces) – of $276.99, which is only few cents above the average calculated over its Canadian peers.
Disclosure: I have no positions in Iamgold Corporation.
