en.Wedoany.com Reported - P2 Gold (TSX-V: PGLD | OTCQB: PGLDF) is advancing a core work program at the Gabbs gold-copper project in the Walker Lane Belt, Nye County, Nevada: geotechnical drilling directly used to define final pit slope angles and stability, parameters that will be incorporated into the feasibility study (FS) targeted for completion in Q4 2026. The junior mining company, holding a 100% interest in the project, announced the geotechnical drilling on June 18, 2026, following a comprehensive project status update on June 9. Together, these two releases outline current progress.
The significance of the geotechnical drilling lies in its direct service to FS-level mine planning, rather than being a parallel auxiliary activity. Holes are positioned on the perimeter of the planned open pit, specifically designed to collect rock mechanics data needed to determine pit slope angles and stability design parameters. These parameters directly dictate the amount of waste rock that must be stripped per ton of ore, thereby influencing operating cost and capital expenditure assumptions in the FS.
Steeper pit slopes, if supported by geotechnical data, can reduce total waste movement over the mine life, lowering the operating cost structure. Conversely, without this data, mine planning cannot achieve the confidence level required for an FS, nor can it calculate on a defensible basis the project economics to be disclosed in Q4 2026. P2 Gold confirmed that diamond drilling was completed and demobilized as planned by the end of May 2026, a timeline that supports the Q3 2026 mineral resource estimate (MRE) and Q4 FS, reducing execution risk for FS delivery.
The geotechnical drilling returned broad mineralized intervals at the planned pit boundary, sending a specific signal to the market: the Sullivan Zone is larger than assumed in the current mine plan, with the edge of economic mineralization closer to, or even beyond, the planned pit limits. Holes located on the pit wall intersected thick zones of gold-copper mineralization, confirming that mineralization does not thin at the planned mining boundary, a positive indicator for the continuity of the upcoming MRE update in Q3 2026.
In the Sullivan Zone, deeper footwall mineralization combined with the main mineralized body to form a composite interval up to 175 meters thick. This result confirms that the Sullivan Zone has significant vertical depth and width at the confidence level required for mine planning, providing support for incorporating this zone into the resource model for the updated MRE.
The confirmation that the Sullivan Zone remains open along dip is a resource conversion signal, not merely an exploration discovery. P2 Gold has accordingly planned a 7,500-meter reverse circulation (RC) drilling program specifically targeting this footwall mineralization, with the goal of including this material in the FS MRE. This is not speculative follow-up work, but a program designed to delineate the gold-copper material that geotechnical holes have already shown to exist at the pit edge and assess whether it falls within an economic pit shell.
Since the program commenced in October 2025, Gabbs has completed a total of 70 RC holes across the Sullivan Zone and Lucky Strike Zone, in addition to geotechnical and exploration holes completed before the diamond rig demobilized. The infill and extension program at Lucky Strike, combined with the new footwall drilling program at Sullivan, together constitute the final drilling inputs for the Q3 2026 MRE. The volume of drilling data supporting the updated MRE is significantly larger than the dataset that supported the October 2025 preliminary economic assessment (PEA).
The October 2025 PEA, based on a smaller production rate of 9 million tonnes per annum (Mtpa), outlined an average annual production of 109,000 ounces of gold and 33 million pounds of copper over a 14.2-year mine life. The assessment yielded an after-tax net present value (5% discount, NPV5%) of $942.9 million and an after-tax internal rate of return (IRR) of 33.8%. The FS is currently advancing on a larger 12 Mtpa throughput scenario, targeting average annual production of 150,000 ounces of gold and 45 to 50 million pounds of copper, but the updated economics for this larger scenario have not yet been released. This means the reference data currently available to investors does not reflect the larger scale the company is building towards.
The FS, due in Q4 2026, will demonstrate the economic value of the larger production scenario. Metallurgical test work (for Sullivan, Lucky Strike, and Car Body zones) and the updated MRE are both scheduled for delivery in Q3 2026, two steps that must be completed before the FS. Until these results are in hand, the 12 Mtpa throughput is a well-supported target, but not yet fully validated.
Water is a practical prerequisite for mining operations, and in Nevada, it must be formally permitted before construction can begin. P2 Gold entered into a definitive agreement on April 2, 2026, to acquire water rights sufficient to support a 12 Mtpa operation. Converting these water rights from their current use to mining use requires approval from the Nevada Division of Water Resources (NDWR), with a target approval timeline of 6 to 12 months, aligning with the expected FS completion. By securing water rights for the larger scenario in advance, the company's intent is to remove a permitting dependency step between FS completion and a construction decision. Either outcome within the approval window keeps the construction start timeline on track for late 2027 to mid-2028.
A detailed mine plan submission to the Bureau of Land Management (BLM) is targeted for late 2026, with environmental approval targeted for 2027. If environmental approval is received in 2027, construction could commence by the end of that year, with a backup window extending to mid-2028. The BLM submission depends on a regional water model currently being built from an ongoing on-site well program, which involves test wells and monitoring wells at the Sullivan and Lucky Strike pit locations. The water model must be completed before the detailed mine plan can be submitted.
Nevada is a mature mining jurisdiction, a characteristic that reduces the likelihood of regulatory disruption and supports Gabbs' ongoing parallel permitting strategy. P2 Gold has engaged local consultants with direct Nevada mining experience to advance BLM baseline study reports and environmental work ahead of the final mine plan submission. The company accepts the risk that some baseline work may require updates in exchange for compressing the overall permitting timeline. The BLM submission schedule and NDWR approval are the two most directly relevant permitting variables determining whether a 2028 construction start is feasible.
The updated MRE for Q3 2026 is the most significant near-term milestone for Gabbs. Investors should focus on resource classification, the ratio of higher-confidence indicated resources to lower-confidence inferred resources, and total gold-equivalent ounces when evaluating it. For FS-level mine planning, indicated resources provide the confidence level required for mine scheduling, cost estimation, and project financing. A project with a large but predominantly inferred resource base has lower FS credibility than one where the mined material is well-classified and supported by dense drilling.
The infill and extension program at Lucky Strike is designed to upgrade lower-confidence inferred material to indicated resources and test the zone's extensions. The Sullivan geotechnical program has confirmed the zone extends to the pit edge with consistent grade and width, providing structural confidence to support a stricter resource classification in that area. The combination of conversion work at Lucky Strike and geotechnical confirmation at Sullivan means the Q3 2026 MRE should reflect a larger total inventory and a higher proportion of well-classified material compared to the resource that supported the October 2025 PEA. This data will determine how investors price the project ahead of the Q4 2026 FS.
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