Mining Co. With High-Grade Gold Potential Starts Drilling Campaign in Nevada

1. Western Exploration Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Western Exploration Inc.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
4. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

For additional disclosures, please click here.

Western Exploration Inc. (WEX:TSX.V; WEXPF:OTC) announced the start of its fully funded 2025 drilling campaign at the high-grade Aura Project located in Elko County, Nevada.

This 4,000-meter reverse circulation drill program is designed to assess a 1.3-kilometer segment of the Tomasina Fault zone, extending downward from the existing Wood Gulch and Saddle NI 43-101 resource areas, the company said in a release.

Historically, the Wood Gulch Open Pit, which was operational from 1988 to 1990 under Homestake Mining Company, yielded some of the highest-grade drill intercepts on the Aura Property. Notable results included 13.72 meters at 79.26 grams per tonne gold equivalent (g/t AuEq) and 9.45 meters at 26.56 g/t AuEq.

"The 2025 Aura reverse circulation drill program aims to build upon the exploration successes that have already led to a 54% increase in inferred Au-Ag resources at the Gravel Creek and Jarbidge target areas," said Chief Executive Officer Darcy Marud. "The Tomasina target is directly analogous to the structural and stratigraphic setting of the Gravel Creek deposit, but with the potential added benefit of a 3.0 km strike length and shallower targets ranging from 100-450 meters in depth. Successful discoveries here could significantly extend Western's mineralization across several key zones, potentially redefining the scale and importance of the Aura district."

Drawing on the Gravel Creek model, the 2025 drilling efforts will focus on promising targets where the Tomasina Fault intersects the Frost Creek tuff, extending downward from the known surface mineralization found in the Wood Gulch and Saddle resource zones, the company said.

Geological assessments suggest that the Tomasina Fault meets the highly favorable Eocene Frost Creek tuff at depths between 100-450 meters below the surface mineralization. The Frost Creek tuff has been a particularly receptive host rock at Gravel Creek (located 1 kilometer to the east), evidenced by wide intercepts within the current resource, including 18.29 meters true width at 9.67 g/t AuEq and 20.43 meters true width at 11.97 g/t AuEq.

The drilling program is already in progress and is expected to continue through the third quarter, Western Exploration said. Initial assay results are anticipated by late August or early September, and Western Exploration plans to provide regular updates as further results become available.

NI 43-101 Technical Report Includes PEA, Resource Estimate

In June, Western Exploration submitted a National Instrument 43-101 technical report that included a preliminary economic assessment (PEA) for the Doby George Deposit and an updated mineral resource estimate (MRE) for Gravel Creek. The updated MRE revealed a substantial increase in both the quality and quantity of inferred mineral resources, significantly influenced by the discovery of a high-grade vein within the Jarbidge rhyolite east of Gravel Creek.

The inferred gold content increased from 367,000 ounces to 571,000 ounces, and inferred silver content jumped from 5,307,000 ounces to 9,726,000 ounces, marking an 83% increase in silver content and a 28% enhancement in silver grade, according to the company.

On July 31, the Gold Newsletter noted the start of the drilling campaign. "The objective is to expand the known high-grade gold-silver mineralization along the Tomasina Fault zone," the report stated. "Successful high-grade discoveries from this drilling could potentially rekindle interest in Western, which currently holds an impressive 1.5-million-ounce inferred resource at Aura. Given its current market valuation relative to this existing resource, and considering the project's substantial potential for further expansion, Western Exploration represents a compelling buy at its present trading price."

Chen Lin of What is Chen Buying? What is Chen Selling? expressed optimism about the company, applauding the resource report that showed increased grades and ounces in the Gravel Creek and Wood Gulch deposits.

The indicated gold equivalent grade, maintained at a cutoff of 3 grams per g/t AuEq, has shown consistent figures from 2021 to 2025, with the latest MRE displaying 216,000 ounces of gold and 3,367,000 ounces of silver (Ag).

Key points from the Doby George PEA included a base case after-tax Net Present Value (NPV) of US$70.7 million and an Internal Rate of Return (IRR) of 25.4% (based on a gold price of US$2,150, escalating to US$211.2 million with a potential IRR of 62.2% at a gold price of US$3,000), an estimated total Life-of-Mine (LOM) after-tax net cash flow of US$271.2 million over a five-year project timeline, and projected average annual operating cash flow of US$112.1 million and a payback period of less than 18 months, assuming a gold price of US$3,000.

The report highlighted new exploration opportunities along the GC Fault at Gravel Creek and the potential for expanding high-grade veins in the Jarbidge rhyolite. Management remains optimistic that Western's successful drilling history could lead to further resource expansion with continued drilling and exploration activities. Gravel Creek remains open along strike and downdip, while Jarbidge is open in all directions.

The company said Wood Gulch is the primary focus of Western Exploration's exploration initiatives in 2025, alongside Doby George, for which the PEA was released in May.

The Catalyst: Firms Ups Gold Price Forecast

Gold futures were trading at US$3,411.60 per ounce Monday, while spot gold was relatively steady at US$3,360.09 per ounce, reported Pedro Goncalves for Yahook Finance UK on August 4.

"Gold has made a conservative start to the week following Friday's price jump. A combination of profit-taking and dollar stabilization has caused gold to ease marginally to kick-off the week," said Tim Waterer, chief market analyst at KCM Trade, Goncalves reported.

Last week's market dynamics were influenced by President Donald Trump's announcement of significant tariffs on exports from major trading partners such as Canada, Brazil, India, and Taiwan.

"With Trump aggressively pursuing tariffs again, coupled with a weak US jobs report that could lead to a Federal Open Market Committee (FOMC) rate cut in September, any declines in gold prices are likely to be minimal," added Waterer.

Gold is traditionally viewed as a safe-haven asset in times of political and economic turmoil and tends to gain when interest rates are low, enhancing its attractiveness to investors.

In a positive development, Goncalves said Citi revised its gold price forecast on Monday, increasing it to US$3,500 per ounce for the next three months, up from an earlier forecast of US$3,300. The bank also widened its expected trading range to US$3,300–US$3,600 from US$3,100–US$3,500, pointing to a worsening outlook for near-term U.S. growth and inflation.

"U.S. growth and tariff-related inflation concerns are set to remain elevated during 2H2025, which, alongside a weaker dollar, are set to drive gold moderately higher, to new all-time highs," Citi noted in its analysis.

The bank also observed that gross gold demand has risen by more than a third since mid-2022, fueling the sharp increase in prices, which are projected to nearly double by the second quarter of 2025.

Florian Grummes told Jeremy Szafron of Kitco News on July 29 that a gold breakout is coming, and patient investors will be rewarded.

"We're in a crack-up boom overall," said Grummes, managing director of Midas Touch Consulting, in an interview with Kitco News. "That means everything will move higher because they destroy the purchasing power of your fiat money — whether it's the euro, the dollar, or the Canadian dollar."

Ownership and Share Structure

According to Western Exploration, directors and management own 3% of the company. High net worth individuals hold 8%. Agnico Eagle Mines Ltd. (AEM:TSX; AEM:NYSE) has 14%. Auramet holds 5%. Golkonda LLC holds a total of 46%, the company's website said.

Institutions, including Euro Pacific Asset Management, U.S. Global Investors, and tGOLD (TXAU), own 6%. The remaining 24% is in retail.

Refinitiv reports that Western Exploration has 52.58 million outstanding shares and 24.96M free float traded shares. Its market cap is CA$32.6 million. Its 52-week range is CA$0.58–1.49 per share.