Saracen Mineral Holdings’(SAR) $60m investment into exploration in FY19 is paying off with significant intercepts at numerous deposits/prospects. The standout result was an intercept of 69m @ 4.1g/t at Karari, 400m below the current mining level. Drilling at Thunderbox A Zone, Deep South and Otto Bore also returned extensional results. Infill drilling at Whirling Dervish, including 30m @ 4.9g/t and 30M @ 3.3g/t confirmed continuity of mineralisation in the line-of-sight of decline development. While the ongoing exploration success points to tangible Reserve/Resource expansion, we believe SAR’s current share price already factors in a mine life well beyond current Reserves, particularly at Karari. However, given the momentum of the stock we upgrade to HOLD from SELL.
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