Klondex Mines (TSE:KDX) (OTCQX:KLNDF) said it has increased the measured and indicated ounces at its Fire Creek project in Nevada by 47 percent to 420,500 ounces, at a grade of 38.1 grams per tonne (g/t) gold equivalent.
The new technical report, prepared by Practical Mining, is effective as of December 31, 2014, and reflects the company's goal of upgrading a chunk of resources from inferred to measured and indicated status.
The newest report also estimates another 363,300 ounces in the inferred category, at a grade of 14.7 g/t gold equivalent. The estimate assumes a gold price of US$1,200 an ounce of gold and US$19.00 an ounce of silver.
"We are extremely pleased with the success of our 2014 infill and exploration drill programs," said president and chief executive officer Paul Huet in a release.
"To promote sustainability within the company, we stress the importance of adding to each mineral resource as we progress with the bulk sampling program.
"Our team is dedicated to the future growth of Klondex. Looking to 2015, we are confident that Klondex is well capitalized to complete our planned $33 million exploration and development programs at Fire Creek and Midas."
The company said the latest underground exploration program at Fire Creek was mainly focused on the delineation of veins east and west of the main decline, with several new veins and structures intersected which require further drilling.
It discovered three mineralized structures since releasing the last resource estimate at Fire Creek in April last year, including the Honeyrunner structure located about 33.5 metres west of, and parallel to the Karen vein.
Klondex is engaged in a bulk sampling program at Fire Creek, with ore processed at its Midas mill some 112 miles away. The company is focused on developing the Fire Creek asset into a full production scenario.
Its plan for 2015 includes extending the underground structure 305 metres to the north, and at depth to the south by 442 metres, as well as 91.5 metres vertical. The company expects this to provide the necessary new drill platforms required to improve its understanding of the mineralization north and south.
The latest resource estimate is based on 689 drill holes, which includes data from 272 new holes completed by Klondex last year. Some 1,553 channel samples from trial mining are also included in the report.
Klondex's fourth quarter capped a stellar year for the Nevada-focused gold miner, which recovered a total of 107,860 gold equivalent ounces in 2014, of which 30,460 ounces were produced in the final quarter. The figures exceeded Klondex's guidance of at least 95,000 gold equivalent ounces by more than 25 percent,which was already hiked up from previous forecasts earlier last year.
It is now looking to produce between 120,000 to 125,000 gold equivalent ounces in 2015. The Canadian company, which transformed itself from an insolvent business to a producer with two underground assets in just two years, started recognizing revenue for the first time earlier in 2014 after acquiring the producing Midas mine last February.