Macquarie Research: Outperform rating & $1.00 target for ERAccording to Macquarie Research:
December 15, 2014
Eastmain Resources Inc.
Recommendation: Outperform
12 Month Price Target: $1.00
Event
- Today, during market open, ER reported that it had drilled 17 holes (4690m) on the Clovis Lake target located 3km east of its Eau Claire gold deposit, 100% owned Clearwater project, James Bay, Quebec, Canada. Clovis Lake is a raw target defined by surface trenching and IP geophysical results. ER is targeting a second deposit in the Eau Claire belt.
- ER also provided an update that SRK Consulting has completed the resource modeling progress of wire framing over 100 high grade meshes in the 450 West Zone (~2500 vein intervals). SRK has now started to model the 850 West Zone. The detailed wire framing process will underpin the block model resource estimate for Eau Claire.
Impact - Positive
- Clovis Lake looks like a potential new gold discovery. Although there are no assays reported yet, we note that ER has documented quartz-tourmaline veins in all 17 holes and visible gold in two holes (holes 540 and 551). Significant in our view is that an 11.3m quartz-tourmaline was intersected in hole 543 (suggesting system size) and that 46 individual quartz-tourmaline veins (0.1m to 2.7m thick) were documented in hole 548 (thinner veins tend to be more permissive). We are also encouraged by the presence of sulphides (photos on web site) as there tends to be a positive gold/sulphide correlation at the Eau Claire deposit.
- Eau Claire resource estimate potentially by PDAC? Now that the 450 West Zone has been wire framed, we believe SRK Consulting will be able to complete the 850 West Zone modeling and the overall resource estimate 43-101 by late February 2015. This will be a key catalyst for ER.
Action and recommendation
- We reiterate our Outperform recommendation and $1.00 target. ER controls a 100% interest in two gold belts in the James Bay region, Quebec, Canada.