Red Pine Exploration plunges as it retracts all assays for Wawa gold project

Red Pine Exploration (TSXV: RPX; OTCQB: RDEXF) said on Wednesday it has withdrawn all previously announced assays for the Wawa gold project in Ontario after discovering "inconsistencies" in certain results.

These include assay results announced by way of press releases and those referenced in past disclosure documents, such as the NI 43-101 report for the Wawa project dated June 2023, the company added.

Red Pine Exploration's share price nearly halved on the latest development, trading at $0.12 by by 11:30 a.m. ET. Earlier in the session, the stock fell to a 52-week low of $0.10, dropping its market capitalization to $23 million.

Red Pine management is now conducting a "detailed review and comparison" of the assay results from the Wawa project with its disclosure documents in order to identify and quantify the extent of any incongruities, it said.

The company is also in the process of retaining a qualified independent firm to assist with and to supervise the this review, and to provide an assessment on how any potential findings can impact its project.

Located 2 km southeast of Wawa, northern Ontario, the 70-km² project is host to several former mines that together produced 120,000 oz. of gold in the past. Two deposits on the property are estimated to have an NI 43-101-compliant resource of 1.3 million indicated tonnes grading 5.47 g/t gold for 230,000 oz. and 2.7 million inferred tonnes at 5.39 g/t gold for 471,000 oz.

Red Pine has been looking to expand on this resource from 2019, with 70,000 metres of total drilling planned on the Surluga and Minto Mine South resource areas as well as several greenfield targets. The aim was to provide an updated estimate, followed by a preliminary economic assessment, this year.

To advance its drilling plans, the company last year received a $6.8 million cash injection from Franco-Nevada (TSX; FNV; NYSE: FNV) in exchange for a 1.5% net smelter return on the Wawa project. It followed that up with a $5.2 million bought deal financing in December.