The price of gold has been rocketing and mining companies have been following suit over the course of this month. Gold has reached a new high on anxiety over European debt contagion and the U.S. struggles with the debt ceiling. Metals often serve as safe havens during times of economic uncertainty and there is no doubt this is one of those times. The levels of gold, silver and other metals have been rising in response to the weakness.
That said, while many metals ETFs are expensive to buy in at these levels whereas mining companies, which have tremendous potential for profitability with current gold prices continue to look attractive. Among mining companies on the move is Samaranta Mining Corporation (SAX), which announced the commencement of a tightly spaced 501 line kilometer Magnetometer and Gamma Spectrometer survey on four separate blocks of their Guadalupe property in Antioquia, Colombia.
The survey is designed to help identify the structure and alteration of Samaranta’s properties. The primary goal of the survey is to gain an understanding of the extent of the geological similarities to the Frontino Gold Mines on to the Guadalupe concessions. Frontino has been a successful mine, producing a total of 4.6 million ounces. The geographic similarities appear to indicate Samaranta’s current property could also be rich in gold. A detailed geophysical interpretation of the Magnetometer and Gamma Spectrometer survey would shed light on this.
Both Guadalupe, Samaranta’s current property and FGM are underlain primarily by the same granodioritic rocks of the Segovia batholith. The Segovia Gold Belt is a region of granodioritic rocks defined by a strong fault zone system trending approximately north-south. Gold mineralization within this belt is primarily associated with quartz veins and narrow vein swarms that are spatially related to the major north to northeast trending fault structures. Through this evidence, Samaranta feels there is substantial reason to believe the Guadalupe property may possess gold that could lead toward considerable profitability. At this time especially, the discovery of gold, has the potential to produce value for early investors.