Prodigy Gold shines after "encouraging" Magino drill results

Junior miner Prodigy Gold (CVE:PDG) gave a further update on the drilling program at its 100%-owned Magino mine gold project in Ontario, lifting its shares over 10%.

The drill results came from two portions of the Magino gold deposit: the southwest corner of the proposed open pit and the central area.

Drill hole MA11-105 intercepted a thick zone of good grade gold mineralization in the southwest area: 161.1 metres grading 1.35 grammes per ton (gpt) of gold. In the central area, drill hole MA11-102 cut 36.3 metres of higher grade gold: 2.64 gpt. Drill hole MA11-098, located northeast of hole -102, intercepted 129.0 metres grading 1.01 gpt gold.

Investors welcomed the update. As at 11.48am EDT, Prodigy Gold shares on Toronto's Venture exchange jumped 10.34%, or 6 cents, to $0.64.

Prodigy was formed late last year from the merger of Kodiak Exploration and Golden Goose Resources.

Brian J. Maher, President and CEO of Prodigy Gold said: "The results to date from our in-fill drilling program continue to be very encouraging."

"The nearly completed in-fill drilling program, combined with additional metallurgical studies and the recently reported geotechnical data allowing for steeper pit walls should significantly improve project economics," Maher said.

Prodigy also said that it was on track to release an updated resource estimate in late September.

The company's open-pit Magino project is located 40 km northeast of Wawa, Ontario in Finan Township, approximately 14 km southeast of the town of Dubreuilville.

Magino contains indicated gold resources of 1,92 million ounces grading 1.16 gpt gold (51.6 million tonnes) and 587,100 ounces of inferred gold resources grading 1.04 gpt gold (17.5 million tonnes), Prodigy said.

The company said that total gold production is estimated to be 1.50 million ounces at cash costs of approximately $521 per ounce.

Additional in-fill drilling will continue at Magino for several weeks, Prodigy said.