Phoenix Gold shares have risen after the Kalgoorlie-based gold explorer announced a doubling of resource estimates at its Castle Hill gold project in the eastern Goldfields.
The resource for Castle Hill, located around 50 kilometres northwest of Kalgoorlie, is now estimated to be 10.55 million tonnes at 1.6 g/t gold for 526,000 ounces, representing a 108 per cent increase from the previous mineral resource of 253,000 ounces.
By close of trade today Phoenix shares had gained two cents, to trade at 25.5 cents.
Phoenix managing director John Price said the recent drill results and resource upgrade demonstrated why the management team believe the Castle Hill project has the potential to become a "very large" gold mine.
"The deposit remains open along strike and has only been tested to an average 60 metre depth so extensions are a key focus for Phoenix in the second half of 2011," Mr Price said in a statement.
The resource upgrade will bolster Phoenix's ambition to grow its JORC-classified resources from its initial base of 977,000 ounces of gold by at least 50 per cent to between 1.4 million and 1.5 million ounces by the end of 2011.
The company said it believed that resource base would be sufficient to support an initial mine plan of three to five years and is aggressively reviewing development options.
Phoenix' resources now stand around 1.3 million ounces, representing a 42 per cent increase on the base figure.
