Premier gold still has the Midas touch: Red Lake, Geraldton projects keep Thunder Bay miner drilling.

• Author: Ross, Ian

The good news keeps rolling in for Premier Gold Mines in the form of high-grade drill assay results.

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On the heels of a successful exploration campaign last year, which saw the Thunder Bay exploration outfit advance work on three key gold projects in northwestern Ontario, Premier is poised to do great things in 2010.

The miner received a nice investor bump this past fall when their Red Lake joint venture partner, Goldcorp, announced construction this year of a high-speed underground tram to connect two mines through the heart of that prolific gold camp.

The tram is being placed on their exploration property, Rahill-Bonanza, that sits in the middle of a five-kilometre stretch between Goldcorp's Red Lake Gold Mine and its soon-to-be developed Bruce Channel Mine.

The plan is to use the tram as an underground drilling platform to test high potential areas on a property, in which Premier holds a 49 per cent interest.

"The exploration potential that opens up is huge," said Premier president/CEO Ewan Downie, who saw his company's stock surge to trade at more than $4 a share in early January.

"All the infrastructure is there, permitting is in place for two mines and we are in a good situation to move into production if and when we delineate something that's good enough to go into their (Goldcorp's processing) mill."

Seeing Premier's stock rise doesn't completely satisfy Downie, when he makes comparisons to their peer group in emerging mid-tier companies. "We still trade at a pretty significant discount."

Downie said there's a market perception, "somewhat justified," that Premier is riding Goldcorp's coattails as their Red Lake exploration arm.

They have a property near Geraldton where they hope to outlined a very large gold deposit and enable them to step out of Goldcorp's shadow.

Premier follows a pretty simple 'in-the-shadow-of-the-head-frame' strategy, acquiring and joint venturing on properties that are smack dab in the middle of proven reserves. Their three main exploration projects; Rahill-Bonanza, Hardrock and PQ North are situated near active or past producing mines.

At their prized Hardrock project, Premier is leading the charge in one of Canada's fastest growing gold camps. Located south of Geraldton at the intersection of Highway 11 and 519, Premier's 15-kilometre long package of properties contain eight closed-up mines that operated between the late 1930s and late 1960s.

Almost three-million ounces of gold...