Australian-listed minerals explorer MOD Resources has earned an increase to 80% of its stake in the Sams Creek gold deposit northwest of Nelson, with joint venture partner Oceana Gold.
Sams Creek is in remote and rugged country and has been an exploration target off and on for 41 years, and has an estimated resource of 1 million oz of gold, but never mined.
It s often touted as ''the largest undeveloped gold prospect'' in the country. Any mining would be an underground operation.
MOD managing director Julian Hanna said yesterday that having spent more than $6million at Sams Creek, under its agreement with Oceana, it had moved from a 60% stake to an 80% stake.
MOD halted drilling at Sams Creek in the middle of last year, when gold prices were flagging, to concentrate on drilling its Kalahari copper belt prospect in Botswana.
MOD signed up its joint venture with Oceana in October 2011.
Mr Hanna said yesterday with the increase in MOD's stake, a relatively high New Zealand gold price around $NZ1750 an oz and lower operating costs compared with Australia, there was ''further encouragement'' regarding Sams Creek's potential.
While MOD was concentrating on its Botswana operations, the scaled back activity at Sams Creek included low cost reinterpretation of drill hole data, and an informal review of the resource model, he said.
MOD posted a $7.3million loss for calendar 2014.
GNS Science has published several papers on the area, saying gold was first discovered in Sams Creek, 25km south of Takaka, in 1974. The permit covers 30.6sq km.
The tenement is close to the Takaka River, in steep hill country covered by beech and kamahi forests, bordered by the Kahurangi National Park.
Sams Creek was discovered in 1974 by CRA Exploration (now Rio Tinto), which conducted extensive exploration in the 1980s, including drilling 46 diamond test holes of 5847m.
In 1991, CRA Exploration sold its New Zealand gold exploration assets, including Sams Creek, to an entity which became owned by Oceana. A further drilling programme was undertaken in 2004.
