Shares in the Miles Kennedy-led MOD Resources surged after the company announced a 33 per cent increase in the mineral resource estimate for its Sams Creek joint venture gold project in New Zealand.
The company said the inferred mineral resource estimate for the project at the northern end of the South Island had risen to 1.024 million ounces, based on 18.65 million tonnes at 1.71 grams per tonne, at a 0.7 grams per tonne cut-off.
Sams Creek already hosted a 770,000 ounce resource when MOD struck an earn-in deal with Melbourne-based OceanaGold.
"The resource is all contained within an 800m strike length of the Main Zone prospect, which represents less than 15 per cent of the known 6km strike length of the Sams Creek dyke," MOD said in a statement.
"The Main Zone resource remains open at depth."
The increased resource is based a stage one drilling program of nine holes completed in March.
Mr Kennedy said the resource upgrade underlined his confidence that Sams Creek had the potential to host a multi-million ounce resource.
MOD could earn up to 80 per cent of Sams Creek from OceanaGold by sole-funding staged exploration programs.
The company said it had already begun stage two drilling involving three rigs.
MOD is also drilling for copper and silver at its Botswana copper project.
Shares in the company were up 1.4 cents, or 21.54 per cent, to 7.9 cents at 1.35pm.