Eastmain Resources Inc (TSE:ER) has pressed go on a preliminary economic assessment (PEA) for its Eau Claire deposit in Quebec after a new mineral resource estimate underscored its potential to host an open pit and underground mine.
Eau Claire lies within the group's 100% owned Clearwater property in James Bay.
Using what's called a Whittle(TM) pitshell model and an underground wireframe model, the updated resource shows 826,000 ounces of gold (from 4.2 million tonnes at a grade of 6.16 g/t (grams per ton) of gold) in the higher confidence measured and indicated (M&I) category.
Meanwhile, in the lower confidence inferred resource category, there was 465,000 ounces of the yellow metal, from 2.2mln tonnes of material at 6.49 g/t of gold.
Notably, the new interpretation on what the estimate is based, shows, higher grades and continuity of gold mineralization to a depth of 550 metres (m) and along strike for 1,100 m, which remains open at depth to the east.
Significantly, the measured and indicated gold grade, of 6.2 g/t is a 51% increase on the previous estimate.
"Today, we achieve a major milestone at the Eau Claire deposit and for Eastmain Resources," Claude Lemasson, Eastmain's president and chief exexcutive, told investors.
"This new high-quality mineral resource estimate illustrates true opportunity to develop an open pit and underground deposit in an emerging gold camp, supported by excellent infrastructure.
"The upgraded estimate is supported by strong grades, more conservative parameters, and a new understanding of the high-grade schist (HGS) veins, improved by tighter drill spacing in the core of the deposit. As a result, we commenced preparations for a PEA, anticipated for delivery in H1 2018."
Lemasson noted that as well as the firm now advancing towards pre-development at Eau Claire, Clearwater's exploration potential remained strong for expansion and growth of the deposit.
"Now, with the recent infill program behind us, we look forward to expanding the deposit's footprint and exploring the district potential," he said.
Shares shed 4% to 36 Canadian cents each.