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Freegold, market fired up by gold hit

Shares in Freegold Ventures (TSX: FVL) shot up 112.5% yesterday as the Alaska-focused explorer reported a 188m intercept grading 3.69g/t gold from its Golden Summit project near Fairbanks.
Freegold, market fired up by gold hit Freegold, market fired up by gold hit Freegold, market fired up by gold hit Freegold, market fired up by gold hit Freegold, market fired up by gold hit

Freegold Ventures is evaluating opportunities to resume work at Golden Summit in Alaska

Staff reporter

Drilling, which was temporarily suspended in March due to COVID-19 prevention measures, was testing the projected extension of the Cleary Vein System (CVS) west of former high-grade mine workings.

Freegold said the above-mentioned hole's last 20m graded 9.87g/t, indicating the system was open at depth, while a hole 150m to the east had just intersected the CVS and returned 9m at 2.4g/t before drilling was suspended.

"Management is tremendously excited with these results," president Kristina Walcott said.

The former Clearly Hill mine workings, projected to lie about 500-600m north-east of current drilling, were said to have produced 281,000oz at an average grade of 1.3oz/t before production stopped in 1942.

Freegold said it was continuing to evaluate opportunities to safely resume field activities.

A 2016 preliminary economic assessment for Golden Summit had envisaged a two-phase, 24-year mine life producing a total 2.3 million ounces, with a post-tax NPV5 of US$188 million and IRR of 19.6% using a $1,300/oz gold price.

The company had raised almost C$2 million towards work at Golden Summit in September in a placement at 6.25c per unit, in which Eric Sprott became a major shareholder, acquiring $1.94 million worth of the offering to gain a 14% stake on a non-diluted basis.

Freegold also operates its Shorty Creek copper-gold property, where Australia-based South32 (ASX: S32) has the option to earn 70% under a US$30 million deal struck in 2019.

Freegold's shares, which had closed on Tuesday at C8c, shot up to a one-year high of 38c intraday.

They settled to close at 17c, to capitalise it at $37.5 million (US$26.5 million).