Deccan Gold Mines jumped 8.85% to Rs 24.60 at 10:58 IST on BSE after the company said it has commenced diamond core drilling in its Ganajur-Karajgi PL block.
The announcement was made after market hours on Thursday, 9 January 2014.
Meanwhile, the S&P BSE Sensex was up 157.69 points or 0.76% at 20,871.06.
On BSE, so far 1.23 lakh shares were traded in the counter as against average daily volume of 56,280 shares in the past one quarter.
The stock hit a high of Rs 26 and a low of Rs 23.50 so far during the day. The stock had hit a 52-week high of Rs 26.80 on 3 December 2013. The stock had hit a 52-week low of Rs 13.50 on 7 August 2013.
The stock had underperformed the market over the past one month till 9 January 2014, declining 3.83% compared with the Sensex's 2.87% fall. The scrip had, however, outperformed the market in past one quarter, jumping 11.88% as against Sensex's 2.29% rise.
The small-cap gold mining company has equity capital of Rs 5.89 crore. Face value per share is Re 1.
Deccan Gold Mines (DGML) said that the Ganajur gold project is a lead project of Deccan Exploration Services (DESPL), a wholly-owned subsidiary of DGML, The Ganajur-Karajgl PL block comprises the highly rated Ganajur Main gold deposit and several satellite prospects such as Ganajur SE, Karajgi Main, Karajgi East, Ganajur South, Ganajur Central and Karajgi Hut prospects hosting gold mineralization in banded iron formations discovered by DESPL, DGML said in a statement.
DGML said that previous drilling campaigns in the project, exceeding 6000 meters of drilling have already demonstrated that the Ganajur-Karajgi PL block contains 308,000 Oz of gold up to a depth of 120 meters under 'Indicated' category. Subsequent geophysical studies have suggested the possible extension of the Ganajur Main Ore body along strike and depth, it added.
The present program of nearly 4000-5000 meters of diamond core drilling will cover Canajur Main, its extensions and the surrounding satellite prospects and will include metallurgical and geo-technical drilling, DGML said in a statement.
DGML said it has engaged South West Pinnacle Exploration to undertake this exploratory drilling programme. The purpose of this drilling programme is to find additional resources in Ganajur Main Project and upgrade the 'Inferred' and 'Indicated' category of resources published earlier, it added.
DGML has already entered into a Memorandum of Understanding (MoU) with the Government of Karnataka to establish a gold mining industry in this project area. Mining Lease application in respect of the Ganajur Main project is under consideration at the Ministry of Mines, New Delhi. A scoping study conducted by DGML has revealed that the project is technically and economically viable, the company said in a statement.
DGML said it will keep the shareholders updated on the progress of the drilling programme.
Deccan Gold Mines is engaged in gold exploration activities in Karnataka, Andhra Pradesh, Rajasthan and Kerala.
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