On Tuesday, the company released the results from hole SP11-071, which intercepted 286m of 1.03g/t, including a section of 197m of 1.3g/t. The release discusses a reinterpretation of the Portage mineralization to a north-east dip with a true width of the intercept at 220m. A review during the site visit of the section with hole 71 suggested a potential horizontal mineable thickness of 500m – the north-east dip both increases the horizontal thickness and would imply a lower strip ratio. Notably, the rest of the Portage zone is now open for reinterpretation to a north-east dip and widening of the deposit – from our site visit, we understand a second hole to test this reinterpretation has been completed with good visual indications awaiting assays from the lab.

In our valuation, we have previously assumed mineralization with a 150m width over 1,200m of strike down to 300m for our 5.5mmoz target. The release has increased the maximum width up to 500m (up from 250m previously). Mineralization has also been traced down to depths of 400m and current efforts are focused on extending the 1,000m strike to 1,200m.

Drilling is ongoing with four drills and an additional rig is expected once forest fire flight restrictions are lifted. An initial resource on the Portage zone is expected in Q4 2011 and a PEA is scheduled for Q2 2012.

We maintain our Buy rating and are raising our target to $6.25 from $4.75, based on an increase of our target mineralization to 7.5mmoz, from 5.5mmoz, at a valuation of $100/oz. This increase is based on increases in our assumed width (average of 200m from 150m) and depth (400m from 300m) offset by a reduction in specific gravity (2.2 from 2.45) and grade (1.1g/t from 1.3g/t to reflect likely lower cutoffs with the rising gold price).

FANTOMAS

Valuation based on $100/oz. in-situ seems too low for this deposit.

I think that soon will have to be adjusted to at least $ 150-200 per ounce in the ground.