Shares in the mineral explorer surged more than 9 per cent to 12 cents on Monday morning.
The company said it confirmed the extension of the phosphate belt mineralization from MbAC Fertilizers' (TSE:MBC) Itafos Arraias project onto the Bomfim claims.
The results also confirmed the discovery of at least one mineralized zone, of a minimum 1.5 by 0.5 kilometres in size, with an intercept of 16 metres grading 4.2% phosphate within.
Eagle Star said the magnitude of this intersection is comparable in grade and strike to historical drill holes found at the nearby Itafos deposit.
Data from drilling thus far, combined with geological mapping done by Eagle Star, has also found other high potential targets at the property that have similar geology to the confirmed discovery.
The Itafos mine, located 10 kilometres away from Eagle Star's Bomfim, is scheduled to start production in the first quarter of next year, and has validated the economics of a mining operation in the midst of the agricultural region.
The Itafos project has a total resource of 58 million tonnes grading an average of 5.1% phosphate. Considering Bomfim's equally large area of 30,922 hectares and the similar dispersed nature of the mineralized zones, Eagle Star said it believes that the overall potential of their claims has yet to be uncovered.
"We are very excited about these results. The fact that we were able to not only prove the validity of the geological model we were operating on the basis of, but to also identify a significant mineralized zone through a small scale scout drilling program covering only a portion of what is a very large area lends a lot of credibility to the capabilities of our technical team," said Eagle Star president and CEO, Eran Friedlander.
"We now look forward to the continuation of drilling with great confidence and a much better understanding of where the mineral potential lies within the region.
"We believe this is just the beginning of what is yet to come and expect to further uncover additional mineralized zones while working towards delineating a NI 43-101 resource report on what has been discovered to date."
An aggressive drilling campaign at Bomfim is slated to start early next year, which will continue with the scout drilling program that has 2,000 metres remaining, as well as with a targeted infill program on already identified mineralized zones.
Though only 400 of the total 2,600 metres of scout drilling planned have been completed thus far, Eagle Star said that both objectives of the program have already been met, with the results supporting the genetic model found at Itafos, and confirming the existence of at least one mineralized zone in the northern area of the property.
The next phase will focus on finding additional mineralized zones in the central and southern areas of the asset, and will follow up with infill drilling. Many priority blocks have already been outlined.
Within the northern block, the company said the mineralization remains open in all directions, and could extend at least 1,500 metres in strike, by 500 metres wide.
The potential areas defined by the initial drilling will be used to assist in geological modeling and resource calculation, with technological tests expected to start immediately to determine the most economic process to extract the phosphate for commercial use.
The Bomfim agro-mineral project is located in the southern portion of Tocantins state, Brazil.
All exploration permits, for 30,922 hectares across 4 claims, are already in place, with a resource expected by the fourth quarter of 2013.
The company acquired the Bomfim project at the end of June.
Eagle Star also boasts experienced management. It recently appointed "mineral processing expert" Carlos Perucca to its board of directors as it works to move into production. Perucca brings 25 years experience in mineral process engineering specific to phosphate process design and development, metallurgical studies, feasibility studies, flowsheets and production plant equipment selection, the company noted.
The mineral explorer's COO and resident expert on phosphate is Dr. Jose Eloi Guimares Campos, who has a long history of working in the region over the past 15 years. His experience includes direct involvement as co-advisor to the technical study of the Itafos mine.
Eagle Star has been working to bulk up its position as a provider of agro-minerals ever since announcing a strategic shift in focus to Brazil phosphate exploration in February.
Brazil is one of the leading agrarian countries in the world. In addition to being the fourth largest consumer of agro-minerals, it is the second largest world importer of phosphate, a business that generates around $1.1 billion in sales annually for the country.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.