Orla Mining reports high grade assays from Camino Rojo gold project in Mexico

Orla Mining (TSX: OLA; NYSE: ORLA) has released new assay results from drilling the sulphides zone at its Camino Rojo gold project in Mexico's Zacatecas state, about 50 km southeast of Newmont's (TSX: NGT; NYSE: NEM) Penasquito mine.

The company said the results confirm the presence of wide, higher grade gold zones at the sulphide deposit. The drill program consisted of close-spaced drilling on three sections of the sulphide zone focusing on the extension of the Camino Rojo deposit down plunge of the planned open pit. These drill results are from a deeper sulphide zone at the project where underground mining could occur, while an oxide portion of the deposit could see an open pit operation.

Orla Mining's Camino Rojo gold property in Mexico. Credit: Orla Mining.

Orla says it drilled 14 holes that yielded 27 significant mineralized drill intercepts with a grade-by-grade thickness factor greater than 50 grams gold per tonne by metre. These included ten intercepts with a grade-by-thickness factor greater than 100 grams gold per tonne by metre.

Among the highlights were drillhole CRSX20-01, which returned 2.38 grams gold per tonne over 108 metres starting from 445 metres downhole and drillhole CRSX21-04A, which cut 4.47 grams gold per tonne over 55.5 metres from 606 metres depth.

"We are encouraged with the results from the Camino Rojo sulphides drill program," Jason Simpson, Orla's president and CEO, stated in a news release. "While the geological setting is already well understood, this new information will be meaningful as we refine the geological model and move to focus on possible development approaches. We are pleased that this drilling has reinforced the structural controls predicated by our geologists, and we will likely require more drilling across the orebody, ideally at this more optimal drill orientation."

Equipment delivery at Orla Mining's Camino Rojo project. Credit: Orla Mining.

Orla acquired Camino Roja from Goldcorp in 2017 and hopes to develop the project into an open pit or underground mine. The 6,079-metre directional core drilling program on the sulphide zone began in October 2020 and was completed in April. The company intends to use the data from the drill program to update the resource estimate for the sulphide portion of the deposit.

The company plans to advance the Camino Rojo oxide gold project towards first production before the end of this year (18,000 tonne per day open pit mine with a mine life of six years producing an average of 97,000 oz. gold a year). But, in parallel, it is examining different options for the Camino Rojo sulphide zone. These are the subject of a preliminary economic assessment and include: an underground mine; an open pit mine with processing at a yet to be constructed sulphide facility; and an open pit mine that would process its mineralized material at Newmont's Penasquito plant.

At press time in Toronto, Orla was trading at $4.91 per share within a 52-week range of $3.84 to $7.51. The company has 247 million common shares outstanding for a market cap of $1.2 billion.