Vancouver – Rainy River Resources‘ (RR-V) stock price continues to climb as it releases high-grade infill and encouraging step-out results from its eponymous gold project in northern Ontario.
The company has been working through a 40,000-metre drill program on its Rainy River project, located about 160 km south of Kenora and 418 km west of Thundery Bay. The program involves infill drilling on the ODM17 and 433 zones at 50-metre and 40-metre spacing respectively, as well as exploration drilling on the South and Beaver Pond zones.
The latest infill results from ODM17 included a very impressive 4.5 metres grading 407.9 grams gold per tonne on the western plunge of the zone at roughly 415 metres depth. Earlier this year hole NR06-60 returned 1.5 metres grading 51.21 grams gold at ODM17.
Shallow infill drilling on the 433 zone has returned a number of medium-length intercepts. Hole 10-539 hit 48 metres grading 1.68 grams gold from 80 metres, hole 10-523 intersected 25.5 metres grading 1.56 grams gold from 123 metres, and of particular note, hole 10-533 returned 4.5 metres grading 8.27 grams gold from 170 metres.
Rainy River’s drilling on the little explored South zone returned respectable intercepts, with hole 10-516 cutting 24 metres grading 2.53 grams gold and hole 10-522 hitting 25.5 metres grading 1.02 grams gold.
The company’s stock price jumped 72¢ or 11.3% in two days of trading on the latest drill results, only days after climbing 41¢ or 6.8% on earlier results, to end up with a 52-week high of $7.08.
By the end of the year Rainy River expects to have completed a total of 90,000 metres of drilling on the project as it moves to the next phase of the project. The company plans to have a detailed scoping study and resource report done by the first quarter of next year.
The current resource was released in March and contains both an open pit and underground resource. Combining the open pit and underground, the project hosts an estimated 56.83 million indicated tonnes grading 1.3 grams gold and 1.81 grams silver and a further 68.93 million inferred tonnes grading 1.2 grams gold and 2.73 grams silver.
In May the company signed a memorandum of understanding with the Fort Frances Chiefs Secretariat, representing the seven First Nations in the area, that establishes communication, environmental and economic commitments. Rainy River and the First Nations have also committed to developing and implementing an impact and benefits agreement.
In August, the company upped its 2010 exploration budget to $24.8 million from a planned $18.7 million. The increase is meant to: help better explore the volcanogenic massive sulphide potential to the south, the 433 footwall area, and westward around the Beaver Pond targets; continue infill work on ODM17 and 433; and advance permitting towards an underground exploration program on the ODM17, 433 and South zones to allow for bulk sampling and deeper drilling.
The increase will also help cover a planned $3 million in exploration spending on the TPK gold project. Rainy River optioned the project in the Ring of Fire area of northern Ontario from Northern Superior Resources (SUP-V) in June. Rainy River can earn a 51% interest by spending $9.4 million in exploration over 3 years, paying $300,000 in cash, and buying a total of $1.5 million worth of Northern Superior shares.
Also in August, the company announced a $20.04 million flow-through share financing, offering 2.45 million shares at $8.18 a piece. The financing is expected to close on September 8, at which time Rainy River should have roughly $80 million in cash and 75 million shares outstanding.
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