The Capricorn Metals Ltd (ASX: CMM) share price has soared well into the green across today's session. At the time of writing, the gold producer's share price is $2.23, up 21.53%.
Today's gains come as the company announced it had acquired 100% of the Mt Gibson gold project in Western Australia.
Let's zoom in on what the Australian gold producer released earlier today.
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Acquisition to boost total reserves
Capricorn released it had acquired the Mt Gibson project at a cost of "less than $20 per resource ounce", in addition to a "1% NSR royalty".
The acquisition bolsters Capricorn's resource base to 4.2 million ounces, including resources at its Karlawinda gold project.
The Mt Gibson project was "placed on care and maintenance" where the processing plant was decommissioned and removed when gold was selling at "around $450 per ounce".
Prior to the decommission, production at this site from 1986 – 1999 was "in excess of 868,000 ounces" from open pits up to 100 metres deep.
Capricorn has since completed a "JORC compliant inferred mineral resource estimate" for the site and arrived at a total of 2.08 million ounces of gold.
The company will start technical and environmental studies "required to underpin a reserve estimate" and also conduct a feasibility study on the project "in due course".
Speaking on the announcement, Capricorn executive chair Mark Clark said:
There is every reason to be optimistic about the opportunity with last gold production over 30 years ago from very shallow open pits when the gold price was around A$450 per ounce. We look forward to undertaking an extensive drilling programme to infill and significantly extend the shallow drilling depths to allow an update to the current 2.1 million ounce resource
Capricorn Metals share price snapshot
The Capricorn metals share price has posted a year to date return of 20% and is up 15% across the past 12 months.
These returns have lagged the S&P / ASX 200 Index (ASX: XJO)'s return of ~23% over the past year.
Capricorn Metals has a market capitalisation of $642 million at the time of writing.
