Deccan Gold Mines today said it has been granted mining lease for Ganajur gold project in Karnataka.
Following the announcement, shares of the company soared nearly 20 per cent to settle at Rs 58.05 apiece on the BSE.
"Mining Lease application of the Company's subsidiary i.E., Deccan Exploration Services Private Limited (DESPL) with regard to the Ganajur Gold Project has been approved by Ministry of Mines on July 24, 2015," the company said in a filing to the BSE.
The firm had commenced drilling at its Ganajur Karajgi block with estimated 3,08,000 Oz of gold deposits last year.
The Ganajur gold project is a lead project of Deccan Exploration Services.
The Ganajur-Karajgi PL block comprises the highly rated Ganajur Main gold deposit and several satellite prospects such as Ganajur SE, Karajgi Main, Karajgi East, Ganajur South, Ganajur Central and Karajgi Hut hosting gold materialisation in banded iron formations.
Previous drilling campaigns at the project, exceeding 6,000 metres of drilling have already demonstrated that the block contains 3,08,000 Oz of gold up to a depth of 120 metres under 'indicated' category.
DGML has already entered into a pact with the Government of Karnataka to establish a gold mine industry in this project area.
