Shares of Paramount Gold and Silver Corp. (NYSE/TSX: PZG) hit a one-month high of $3.22 on Tuesday after the company released a new resource estimate for its Sleeper Gold Project in Nevada.
The NI 43-101 resource estimate, prepared by consulting firm SRK, includes oxide and sulfide materials as well as a small amount of alluvial mineralization.
SRK estimates an in situ measured and indicated resource of 2.6 million ounces of gold and 25.3 million ounces of silver and an additional inferred resource of 1.1 million ounces of gold and 8.2 million ounces of silver, using a cut-off grade of 0.20 grams of gold per tonne (g/t) for oxide and alluvial material and 0.25 g/t for sulfide material. The cut-off grades were determined using a gold price of $1,100/oz. and recoveries of 85% for sulfides and 70% for oxides.
Acquired by Paramount in 2010, the 45-square mile project includes the original Sleeper open pit mine operated by Amax Gold from 1986 to 1996, as well as newly purchased claims (Paramount press release Aug. 23, 2011) stretching south to Newmont's Sandman project.
Paramount is expecting to produce a preliminary economic assessment (PEA) of the project by early 2012.