Anaconda Mining has received key permits and releases from the Canadian Government of Newfoundland and Labrador for its Stog'er Tight gold project.
The project is located about 3.5km east of the Pine Cove mill along the Pine Cove mine road.
Anaconda can mine the Stog'er Tight deposit according to the limits outlined in the approved development, rehabilitation and closure plan submitted to the government.
The deposit contains 204,100t of indicated resources grading 3.59 grams per tonne (g/t), as well as 252,000t of inferred resources grading 3.27 g/t.
During the upcoming fiscal third quarter ending February 2016, the company plans to test-mine the Stog'er Tight deposit in a bid to assess and optimise blasting and grade control techniques.
Based on this, mine/mill scheduling would be determined to evaluate ore processing at the Pine Cove mill.
The company plans to pursue the second phase of its development plan once the test mining programme concludes.
Anaconda Mining president and CEO Dustin Angelo said: "As we grow the resource at Stog'er Tight through exploration, we are also conducting detailed studies to evaluate the feasibility of mining at a larger scale.
"The permits received from the government of Newfoundland and Labrador allow Anaconda to begin test mining as part of the evaluation, which represents a significant milestone towards developing a larger scale project."
Anaconda also carried out acid rock drainage (ARD) testing at the RPC Science & Engineering lab in Fredericton, New Brunswick.
The testing indicated that the ore and waste rock are non-acid generating and concluded that the Stog'er Tight material could be blended with the existing Pine Cove pit without modifying the Pine Cove mill circuit.