Oct. 22 (Bloomberg) -- Pretium Resources Inc., the company exploring the Valley of the Kings gold project in British Columbia, fell to its lowest since its initial share offering after reporting that an independent geologic consultant found “no valid gold” resources.
Pretium plunged 28 percent to C$3.45 in Toronto, the lowest closing price since the shares began trading in December 2010. The Vancouver-based company has fallen 74 percent this year.
Pretium today reported preliminary results from the processing of a bulk sample from Valley of the Kings, or VOK, that is within the Brucejack exploration area. The report comes two weeks after Pretium said Strathcona Mineral Services Ltd., one of two companies that had been hired to evaluate ore samples, resigned from the project.
In withdrawing, Strathcona said ore samples showed “there are no valid gold mineral resources for the VOK Zone, and without mineral resources there can be no basis for a feasibility study,” Pretium said today in a statement. Strathcona resigned from the project on Oct. 8 “before any results from the processing of the bulk sample were available,” Pretium said.
In an Oct. 9 interview, Pretium Chief Executive Officer Robert Quartermain said Strathcona quit because of a disagreement with Snowden Mining Industry Consultants Ltd., the other company hired to vet the ore.
“Snowden believed that reconciliation is best achieved through processing all the sample through the mill, which we’re doing,” Quartermain said. “Strathcona believed that sample towers would be representative, but they are a very small fraction of the overall sample size.”
No one from Strathcona’s Toronto offices was immediately available to comment on the Pretium statement.
Quartermain said today his company is concerned about the stock market’s reaction.
The company expects Snowden to report later this year on the results of a comparison of the latest Valley of the Kings ore samples with theoretical results from computer modeling, Quartermain said in a telephone interview.
“The key thing from today’s release is the fact that we have recovered gold from the Valley of the Kings,” he said today. “We were pleased with the material that we have and we want to continue to provide data to the market place.”
Pretium said in today’s statement that Snowden “has taken steps to involve a third party peer review in its up-coming mineral resource update.”
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