The Toronto-headquartered company said Thursday a new resource estimate stood at 1.2 million tonnes grading 5.31g/t gold for 205,000oz indicated and 2.36Mt at 5.22g/t for 396,000oz inferred.

The underground resource represents a significant increase in grade, quality and continuity of the gold zones at Surluga. It entails a shift from an openpit development plan to a high-grade underground model.

The company said the Surluga and Minto mine south deposits were now estimated to contain a combined 230,000oz of indicated gold and 471,000oz inferred, grading on average 5.47g/t. The bulk of the estimated resource occurs to a depth of 350m.

The update was compiled by Golder Associates, using a 2.7g/t cut-off within a 2g/t envelope. Both resources remain open for expansion.

"This new resource estimate speaks to the untapped potential of the gold deposits on the property," said CEO Quentin Yarie.

"With our 59,000m of diamond drilling and the development of a robust geological model, we have significantly improved the quality, grade and the continuity of the high-grade gold zones identified so far at the Wawa gold project."

Red Pine said Wawa hosted several gold-bearing structures that, combined, formed the Wawa gold corridor; a structure that extended for more than 6km. The new resource estimate indicated near-surface gold deposits grading over 5g/t gold could be found along this corridor, it said.

Yarie said these new gold zones could be accessed through the old underground workings of the former Jubilee and Surlaga mines on the property.

"The underground workings of the historic Surluga and Jubilee mines access most of the Surluga deposit resource. This will facilitate any potential underground development plan, and the short distance between the Minto mine south deposit and the Surluga deposit outlines the potential synergies for the future development of those gold deposits."

Red Pine's stock has lost about 43% over the past 12 months, which gives it a market capitalisation of C$14.8 million.