Marathon Gold's (TSX: MOZ) latest resource update for the Valentine project features total measured and indicated resources of 54.9 million tonnes grading 1.75 grams gold per tonne gold for a total of 3.1 million oz. and inferred resources of 16.8 million tonnes at 1.78 grams gold for a total of 1 million ounces.
While the global resource figures have not changed greatly, the updated numbers upgrade 9.7 million tonnes of mineralized material for an additional 400,000 oz. in the measured and indicated category.
The majority of the upgraded resource growth is from the Leprechaun deposit, the second-largest of four deposits at Valentine.
"Refined geological models and mineralized domains, as well as more restrictive capping on the highest grade assays, have yielded the best-constrained estimate achieved at the project to date, particularly in the definition of in-pit, high-grade material," Matt Manson, the company's president and CEO says in a press release.
As previously, the updated resource features underground and open-pit resource subdivisions. The open pit portion is now categorized into high-grade and low-grade subsets. The high-grade, open-pit material makes up the bulk of the resource and would be processed first in the mine plan. The low-grade material would be stockpiled and processed later in the project's mine life.
In the measured and indicated category, updated high-grade open-pit resources total 30.6 million tonnes at 2.62 grams gold and the low-grade portion stands at 22.9 million tonnes at 0.47 gram gold.
A pre-feasibility for the Valentine project is underway, and trade-off studies looking at the optimal project scope and development plan are now complete. The study, expected in the second quarter, will examine the option of a single ore stream from the Leprechaun and Marathon deposits feeding a conventional mill.
Mick Carew, who covers Marathon Gold for Haywood Capital Markets states in a research note that "Marathon has delivered an updated resource that employs more rigour in terms of restrictive parameters used during the resource estimation process." Carew adds that "Marathon is a well-positioned target as M&A activity moves downstream to resource/economic study-stage projects."
With the release of the updated resource, Carew increased his target price for Marathon to $2.50 per share, up from $2.00 previously.
At press time in Toronto, Marathon Gold was trading at $1.52 per share with a 52-week trading range of 78 ? to $1.76. The company has 178.9 million common shares outstanding for a $271.8-million market capitalization.