The Rouyn-Noranda, Quebec-based company said drilling along the Larder Lake-Cadillac Break in Quebec was aimed at driving meaningful resource growth. Drilling to date had demonstrated high-grade gold mineralised continuity within and below the current resource area.
CEO Mario Bouchard said exploration progress was mainly owing to the robust litho-structural model the company had put together, released a year ago.
"[The model] has proven to be quite accurate in targeting high-grade mineralisation both in the Upper and Lower zones. The model comprises 63 mineralised zones, that in places show sub-vertical enrichment trends very similar to structures mined previously at the old O'Brien mine, where 90% of the historic production came from only three veins with an average grade of 15.25 grams per tonne gold," Bouchard said.
He said of particular interest to the company was the Lower 36E zone, which had been the main target with about 20,000m drilling completed so far, of which results for about 13,780m had been released. Several decent intercepts suggested good continuity of mineralisation within what appeared to be a high-grade "enrichment vector" that had by now been drilled from 550-955m depth, he said.
"While there has been limited deep drilling to the east of this area, our model and historical information suggests the potential for additional steeply plunging enrichment vectors at set intervals from west towards east. Our expanded drill programme will target these vectors within and below the current resource area," said Bouchard.
The company said two drill rigs continued to turn 24/7 on the property with the exploration fully funded by the company's C$7.8 million treasury. All-in drill costs were averaging $110-$120/m, "well below the industry average".
The former O'Brien mine is considered to have been the Abitibi Greenstone Belt's highest-grade gold producer from 1926-1957, producing 587,121oz at an average grade of 15.25g/t.
Shares in the company (TSXV:RDS) has recently doubled to a 12-month high at 24c, and despite a 2.7% drop on Thursday to 18c, are still trading at an 80% premium to the year-ago price. The company has a market capitalisation of $34 million (US$25.4 million).