Ocean Equities expects
) to report a significant increase in the resource at its Osikonmaki joint venture gold project before the end of the year.
The note from Ocean followed yesterday's confirmation of a new high grade gold discovery at the company's Rantasalmi gold property in Finland. Belvedere told investors that a recent drill programme at the Osikonmäki East prospect's Upper East HW zone had confirmed the initial find, announced last year.
Drilling has continued to develop and extend the Upper East HW zone and one of the holes was mineralised for almost its entire 205 metre length.
This zone is now considered by Belvedere to be a significant new discovery.
Additionally Belvedere said it has identified the potential for a bulk tonnage target, with what appears to be a zone of lower grade mineralisation adjacent to the discovered high grade zone in the hanging wall.
The Osikonmaki East prospect currently has an indicated resource estimate 68,000 ounces and an inferred resource estimate of 244,000 ounces of gold.
Ocean analyst Christopher Welch expects delineation of the higher grade zone in the east to quickly add ounces to the resource and improve project economics.
He added the combination of the Upper East hanging wall zone with a broader zone of lower grade mineralisation means that the company will be able to start with preferential high grade mining and evolve into a larger scale mining operation.
Furthermore, Belvedere could acquire more claims around the recent discoveries at Osikonmaki, said Welch, noting that its geological team has a "great understanding" of the gold distribution around its properties and could quickly add value to new licences.
"Being in first place to receive licences in areas of known gold mineralisation highlights the potential of the company to grow into a substantial gold producer in an area of low political risk," said Welch.
The company funds its gold exploration projects with revenues from its Hitura nickel mine in Finland.
Early this year, the company extended its sales agreement with Jinchuan Group, China's largest nickel producer, de-risking the expansion phase of the mine and securing funds for its gold assets including the Kopsa copper-gold project.
Welch said a scoping study at Kopsa, which is expected to start producing within the next two years, would be supportive for Belvedere's share price.
According to Welch, with a market cap of C$18 million, the company is undervalued based on either its nickel mining or its gold exploration operations.
"There is some debate regarding the complexity of operating both areas of the business at the same time, but it is clear that the team has been able to turn profit at Hitura into gold discoveries at its joint venture projects," said Welch.
"Osikonmaki has been a priority for the company during the initial stages of the joint venture, and the team has successfully led the exploration campaign.
"Now Belvedere can look to add value to its other gold asset and deploy the profit from its nickel operations to purely serve its own shareholders."