De Grey (ASX:DEG) share price rockets 11% on latest update

The De Grey Mining Limited (ASX: DEG) share price is surging 11.5% after the company announced “significant” gold results at one of its sites.

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A drawing of a white rocket streaking up, indicating a surging share pirce movement

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The De Grey Mining Limited (ASX: DEG) share price is surging today. At the time of writing, shares in the gold miner are trading for $1.55 – up 11.5%. By comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.31% higher.

The company comes into focus this morning as it announces “significant” drilling results at one of its sites in the Pilbara region of Western Australia.

Let’s take a closer look at today’s news and what it means for the De Grey share price.

What’s affecting the De Grey share price?

In a statement to the ASX, De Grey Mining says initial drill results at the Diucon-Eagle mining sites in the Hemi prospect have confirmed a large mineralised system.

The company highlighted the following results:

  • a 14m wide ore with 21.2g of gold per tonne.
  • a 19m wide ore with 4.4g of gold per tonne.
  • a 17m wide ore with 5.7g of gold per tonne, and
  • a 61m wide ore with 2.g of gold per tonne.

De Grey says the results “demonstrate the potential to rapidly and cost-effectively” add to its site gold endowment.

Investors are reacting well to today’s news, judging by the De Grey share price climb.

Management commentary

De Grey managing director Glenn Jardine said:

These recent results at Diucon and Eagle confirm the presence of a large mineralised system in the west of Hemi. Both zones remain open to the west toward Antwerp. Diucon and Eagle represent another step change to the gold endowment at Hemi.

RC drilling to determine the overall scale along strike continues and diamond drilling of potential down dip extensions is expected to commence during the quarter.

Gold commodity price

Gold is currently trading on the commodity market for around US $1,790 per troy ounce. It’s down 5.54% since the beginning of the year and 13.4% lower compared to its record of US $2,069 per troy ounce. Gold hit that record in August last year. However, it is 3.6% higher over the last month.

The website Trading Economics attributes the precious metals recent rise to “a weaker dollar and lower treasury yields” as well as fears over rising COVID cases in parts of the world. Gold is seen as a safe investment by some investors, according to the website.

De Grey share price snapshot

Over the past 12 months, the De Grey share price has increased 308.2%. Its share price shot up 16% on 23 April, as the miner announced preliminary results at other sites in the Hemi prospect.

De Grey has a market capitalisation of $1.9 billion.

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Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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