Xtract Resources jumps on new gold discovery in Chile

Shares in Xtract Resources jumped over 7% on Wednesday, as the exploring company said it had found a small but “significant" concentration of gold near the surface at its Chepica mine in Chile.

The London-listed group said the find, situated at the intersection of two major geological structures at the Salvadori prospect, could contain up to 1,000oz to a depth of 25 metres, worth an estimate $1m (£640,000) at current market rates.

In a statement released on Wednesday, Xtract said it had stepped up exploration on the site after reporting last week that high grades in the ore originating from another surface operation led to a sharp increase of the gold content in the concentrate produced from Chepica.

The group said mining of the new deposit was scheduled to begin by the end of the month, adding that a mining contractor had been appointed to plan the extraction of the ore zone from surface to level two.

“The discovery of this zone and the fact that we can start to mine this zone imminently will benefit the revenue and profitability for the month," said group chief executive Jan Nelson.

Xtract shares were up 5.78% at 15:47 on Wednesday.