A Gander-based mineral exploration company has made a gold discovery along the southwest coast, and hopes future assaying results will bode well for its claim.
Metals Creek Resources received test results for the first two drill holes at its Staghorn gold property, located down the Burgeo highway, 50 kilometres north of Hope Brook Goldmine.
Sandy Stares, president of Metals Creek Resources, said his company was aware of two holes drilled by another company in 2005.
"They had some broad intersections of gold, too," said Stares, who is one of three brothers with an interest in mineral exploration.
That company, Candente Resource Corp., determined there was not enough for them to continue drilling, and Metals Creek took over from the prospectors controlling the site.
Metals Creek re-established the grid and took soil samples. Following the initial test results, the group drilled 25 further holes just before Christmas, and is awaiting those results.
The deepest of those holes drops 100 metres vertical, said Stares.
"There's great potential for a bulk tonnage, lower-grade gold target, with some medium to higher-grade material in this bulk tonnage," he said.
The initial drilling commenced Nov. 2.
As a market, Stares said gold is a strong one. On Jan. 11, its price closed at US$1,158.70 per ounce.
"When the U.S. dollar drops, the price of gold rises in conjunction with it," he said.
While he noted there are signs the American economy is due for improvement, he remains confident gold will remain a good commodity.
Last January, the company also discovered high-grade platinum and palladium on the Baie Verte Peninsula.
Channel sampling results from last summer showed more platinum, palladium and gold results, and Stares said the company will look for a larger partner who understands platinum group elements.
This project is particularly promising, he said, as platinum and palladium prices have jumped considerably over the last year.
Stares said junior exploration companies benefit from a provincial government program allowing them to collect a grant for half the money put into the ground - up to $100,000.
"It's a great incentive program to get junior exploration companies into the province to do some exploration."
The program starts again in April, and Stares expects his company will begin further drilling at the Staghorn site around that time.