Co. Reports 94.8% Gold Recovery From Composite Samples in Nevada

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* Disclosures for the quotes from the Clive Maund article published on August 21, 2024

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The quoted article represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be only be construed as a recommendation or solicitation to buy and sell securities.

Western Exploration Inc. (WEX:TSX.V; WEXPF:OTC) announced the results of metallurgical testing on composite samples collected from core drilling within the Jarbidge rhyolite hanging wall zone of the Gravel Creek deposit at its wholly-owned Aura gold and silver project in Nevada.

Locked-cycle flotation tests done this year on the cores collected in 2023 indicate recoveries of 94.8% for gold and 89.8% for silver in a combined gravity and flotation concentrate, the company said in a release.

"Preliminary metallurgical test work on Gravel Creek hanging wall mineralization has returned very positive results for the recovery of gold and silver to concentrate," Chief Executive Officer Darcy Marud said. "The recoveries are similar to past Gravel Creek metallurgical test work and demonstrate a potential path to economic recovery for precious metals."

Western Exploration said the combined gravity and flotation concentrate were 10.9% of the feed weight and averaged 57.1 grams per tonne gold (g/t Au) and 1,725 g/t silver (Ag).

The flotation concentrate averaged 29.1% sulfide sulfur, the company said. Gravity concentration before rougher flotation concentration (from the gravity tailings) recovered 22.4% of the gold and 4.4% of the silver in 0.16% of the total feed weight with a gold grade of 920 g/t and a silver grade of 5,750 g/t.

The Aura Project consists of three locations in Nevada: Doby George, Gravel Creek, and Wood Gulch. Earlier this year, the company announced that it is expanding the size of the Wood Gulch/Gravel Creek resources area and working toward a resource update for Doby George.

Technical Analyst Clive Maund agreed that bright days could be ahead for the stock.*

"Western Exploration is powering up for a major bull market," he wrote. "The price/volume has been positive for most of this year, and the price is now starting to advance away from the base that started to form as far back as August of last year, and at a time when the entire sector is commencing a major bull market. Holders of Western Exploration should, therefore, stay long, and it is rated a Strong Buy here as the bull market is still in its earliest stages."

Composite Assays

At Gravel Creek, Western Exploration said flotation test work was conducted on a gold- and silver-bearing diamond drill composite from core holes WG456 and WG457, drilled in 2023 in the Jarbidge rhyolite. The two oriented core holes were completed to evaluate resource expansion potential in mineralized vein/breccia trends northeast of the Gravel Creek resource.

As previously reported by the company, Hole WG456 was located 250 meters northeast of the Gravel Creek resource area and reported individual assays up to 34.9 g/t Au and 2,800 g/t Ag and Hole WG457, located 140 meters northeast of the Gravel Creek resource area, reported individual assays up to 257 g/t Au and 1,655 g/t Ag.

The composite was comprised of sulfide mineralization collected from samples ranging in downhole depths of 316 meters to 731 meters in WG456 and WG457, Western Exploration said.

Composite assays showed that it contained 6.14 g/t Au, 206 g/t Ag, and 2.71% sulfide sulfur, the company said. Cyanide shake analysis showed that the sample had cyanide soluble to fire assay ratios (CN/FA) of 53.4% for gold and 36.8% for silver. The composite contained negligible amounts (<0.1%) carbon.

"Flotation testing showed that the Gravel Creek mineralization responded very well to bulk sulfide flotation treatment," the company's latest release said. "Gold and silver recoveries of as high as >92% were achieved with rougher flotation mass pulls of approximately 11%."

All test work was completed by McClelland Laboratories Inc. of Sparks, Nevada.

The Catalyst: New Highs for Gold

It's been a big week for the yellow metal. Gold prices rose more than 1% Thursday after the Federal Reserve cut interest rates for the first time in four years, hitting an all-time highs and jumping past US$2,600 on Friday morning. It was US$2,622.90 per ounce on Friday at the time of writing.

"The market is factoring in bigger and more rate cuts because we have both fiscal and trade deficits, and that's going to further weaken the overall value of the dollar," Alex Ebkarian, chief operating officer at Allegiance Gold, said according to a Reuters article on Friday.

"If you combine geopolitical risks with the current deficit that we have, along with the low-yielding environment and weaker dollar, the combination of all these is what's leading to gold's rally," Ebkarian told author Anushree Ashish Mukherjee.

"Gold market bulls are locking in bullion prices surging to fresh records, with a milestone of US$3,000 per ounce coming into focus, fired up by monetary easing by major central banks and a tight U.S. presidential election race," Mukherjee and Anjana Anil wrote in another Reuters report.

Ownership and Share Structure

About 72% of Western Exploration is owned by strategic entities and high net worth investors, according to its latest investor presentation, including Golkonda LLC with about 46%, Agnico Eagle Mines Ltd. with 14%, and Auramet Capital Partners with 5%.

Other institutions hold about 6%, insiders and management hold about 3%, and the rest is retail.

Western Exploration's capital structure consists of 43.8M outstanding shares and 16.21M free float traded shares. Its market cap is CA$45.11 million. Its 52-week trading range is CA$0.46−$1.50 per share.