Broker Canaccord Genuity (TSX:CF, LSE:CF) has repeated a 'Speculative Buy' on O3 Mining Inc (TSX-V:OIII, OTCQX:OIIIF) following the company's release of latest drill assays from the Camflo extension deposit at the Marban project in Val-d'Or, Quebec.
In all, 6,338 metres (m) were sunk in two holes and three wedges on the extension as part of the work, which tested the depth extensions of the historic Camflo deposit and additional high-grade zones.
Among the highlight assays were from a hole, which returned 1.1 grams per ton (g/t) gold over 94.3m starting from 1,258.9m depth. Within that, there was a high-grade interval of 13.8 g/t of the yellow metal over 1.1m. All holes and wedges returned large mineralized intervals within the Camflo Plug, 03 had reported.
"Camflo is a historic mine that lies immediately west of the Marban property and is currently owned by the Canadian Malartic Joint Venture. The mine produced 1.89Moz of gold at 5.71g/t when it was operated by Barrick, however, production was halted in 1992 due to the low gold price environment," noted Canaccord analysts.
READ: O3 Mining encouraged by drill results at Camflo extension deposit at Marban project, Quebec
They added that O3's drill results had confirmed "the existence of broad widths of mineralization at depth in the Camflo plug" but that they had not found "the same high grade material that had been seen in Barrick's historic drilling".
"Given the depth of today's intercepts we do not believe the Camflo Extension will be economic for O3 as it currently stands. Looking forward, we expect O3 will turn its attention to the rest of the Marban land package as it continues its 40,000m drill campaign," said the Canaccord analysts.
O3 is currently completing a 73,000m drill program split between its Marban (40,000m) and Alpha (33,000m) properties.
The broker repeated a 'Speculative Buy' rating and C$3.10 target price, which is around 57% higher than the stock's closing price of C$1.97 on June 30.
O3 Mining is an Osisko Group company and describes itself as a gold explorer and mine developer on the road to production from its highly prospective camps in Quebec, Canada.
Contact the author at giles@proactiveinvestors.com