The African Gold Ltd (ASX: A1G) share price is rocketing straight to the moon.
At the time of writing, shares in the gold miner were trading for 35.8 cents each – up 74.39%. At one point today, shares exploded to an all-time high of 43 cents, which is an astronomical 110% increase on the previous day's close.
Today's positive price rise comes after the company announced "high-grade" gold assay results from one of its mines and a capital raise.
Let's take a closer look at today's news.
Image source: Getty Images
The African Gold share price is flying
In a statement to the ASX, African Gold confirmed "high-grade" assay return samples at its Didievi Gold Project in Côte D'Ivoire. Highlights include:
- a 10m wide ore at 123g of gold per tonne including 2.0m at 613g of gold per tonne
- a 17.4m wide ore at 17g of gold per tonne including 1.0m at 216g of gold per tonne
According to the company, the BG system at Didievi is currently over 1.5km x 1km and open. It has identified a number of new lodes as part of the recent drilling program. This announcement may be one reason the African Gold share price is rising.
As well, the company announced it would launch a rights issue to raise approximately $3.9 million. African Gold will undertake a 2 for 7 non-renounceable rights issue at 15 cents per share. The company says the funds will be used to cover the costs of the offer and then for capital works.
Management commentary
African Gold CEO and Exploration Manager Glen Edwards said:
We recently announced some spectacular broad, high-grade intercepts from our recently completed drilling programs at our Didievi Gold Project in Côte d'Ivoire.
Historically, it hasn't been recognised that a high-grade gold component existed at Didievi however artisanal miners have been collecting free gold on the margins of the deposit. The historical drilling was assayed by fire assay (the most common assay method) which picked up some very high grades. As part of the QA/QC of our current drill program we ran screen fire assays over the higher-grade intervals.
African Gold share price snapshot
Over the past 12 months, the African Gold share price has increased 157%. Year to date, the company's value has appreciated 33.33%. It has vastly overperformed the price of gold.
In 12 months, the yellowish metal's market price has decreased 7.65%. While since the start of 2021, it is 5.22% lower. It is currently trading at around US$1,800 per troy ounce. Looking ahead, Trading Economics is forecasting the price of gold to marginally increase by the end of the quarter before falling to around US$1,740 per troy ounce in a year's time.
