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Yesterday, Richmont Mines (RIC, TSX) reported fresh drill results from its growing Wasamac deposit including 7.28 g/t Au over 31.40 metres (true width) in the Main Zone.   Needless to say, the market was impressed as RIC blasted through resistance at $10 per share into new all-time high territory.  The stock jumped $1.48 or 16% to close at $10.75 on the TSX.   Richmont is demonstrating a robust system at Wasamac which has been one of the best-kept Gold secrets in northwest Quebec, though that’s obviously about to change as new eyes are starting to focus on this intriguing property.

Wasamac is an exciting and important play, as we’ve been stating at BMR for many months, and we look forward to reporting on it even more extensively during our upcoming visit to Rouyn-Noranda and the surrounding region beginning very shortly after Labour Day.  Richmont President and CEO Martin Rivard has agreed to an in-depth interview with us, plus of course there’s also the Visible Gold Mines‘ (VGD, TSX-V) angle as VGD – to its credit – was quick to understand the geological potential of the Wasamac area and has positioned itself for success there by aggressively exploring its optioned Wasa Creek and Wasa East properties.  As soon as the Richmont news hit the wire just minutes before the opening bell yesterday, buyers stepped up to the plate with VGD which overcame resistance at 35 cents and enjoyed its best volume day in over four months.  VGD is breaking out technically and the market has plenty to speculate about after assays from the company’s first hole at Wasa Creek gave very encouraging indications.

Meanwhile, Cadillac Mining (CQX, TSX-V) is beginning to stir and rightly so.  Not only does CQX hold a 40% interest in Wasa Creek and Wasa East through its agreement with VGD (plus all of Lucky Break and Cadillac Break ground), but the principal structure hosting Richmont’s Wasamac deposit dips northerly toward the seven titles comprising 164 hectares owned 100% by Cadillac.  The question now is, what’s Cadillac’s next move after yesterday’s news from Richmont?  CQX has a great little property and their options include exploring it on their own or cutting a deal with an interested party.  It’s hard to imagine that Visible Gold Mines has not made overtures to Cadillac regarding CQX’s very prospective 7 Wasa claims.  The two companies already cut a deal in December on what is now Wasa Creek and Wasa East.  VGD has $6 million in working capital, the drill rigs and all the resources it needs – VGD is a perfect solution for cash-strapped Cadillac to immediately unlock the value of its Wasa claims which are geologically highly interesting and could be a depth extension of the Wasamac deposit.

A fabulous story is unfolding at Wasamac and we’re eagerly looking forward to reporting directly from the scene in the very near future.  Northwest Quebec, as our readers know, is unquestionably one of the hottest addresses on the entire planet for Gold exploration and mining.  In the parlance of the prospectors, it’s Big Elephant Country.  And it’s Super Big Elephant Country when Gold is trading where it is now, around $1,800 an ounce.

Below is an excerpt from one our recent BMR “eAlerts” concerning Wasamac. If you have not yet registered to receive our eAlerts, please check out the post immediately preceding this one for instructions.

(August 21, 2011)

Wasamac’s a Winner – New Multi-Million Ounce Deposit in the Making?

Visible Gold Mines is aggressively drilling the immediate area surrounding Richmont Mines’ growing Wasamac deposit which is just off the main highway leading into Rouyn-Noranda from the west (about 15 kilometres from the city).  Mark our words, and we’ll explain why in more detail during our upcoming visit to the area, but Wasamac is one of the best-kept Gold secrets in northwest Quebec right now.  The story of Wasamac and the strong potential for a multi-million ounce deposit there has been flying under the radar of most investors for the last year.  That is likely about to change which is why we were almost screaming at our readers from the rooftop recently when Richmont was trading around $7 a share.  It quickly exploded to a new all-time high of $9.98.  Richmont, which trades on the TSX and the AMEX under the symbol “RIC”, is expected to provide a major exploration update on Wasamac any day now.

Visible Gold Mines borders the Wasamac Property to the east, the south and the west through an option agreement completed last December with Cadillac Mining (CQX, TSX-V).  This general area is geologically highly prospective and the former Wasamac Mine produced produced 250,000 ounces of gold between 1965 and 1971.  Record-high Gold prices encouraged Richmont to re-visit Wasamac in the spring of last year and drilling to date has shown that what was mined in the 60’s was likely only a fraction of the Gold that is actually there.

On August 11, VGD’s share price jumped 26% when it announced that several zones of Gold mineralization were hit on its very first hole (LBWC-11-03) at Wasa Creek, a previously unexplored area. The hole was collared about 450 metres north of the prolific Cadillac Fault, which runs right underneath the middle of the Wasa Creek Property.  Significantly, drilling intersected a 16.4-metre section with a close coexistence of Gold and pyrite in a disseminated shear zone, similar to the style of mineralization at Wasamac.

What’s particularly interesting is that Visible Gold Mines had virtually nothing to go on when they planned the first hole at Wasa Creek – historical exploration in this area has, surprisingly, been almost non-existent.  The hole featured several zones of mineralization at different depths, including some high-grade, in addition to “many sections” of anomalous Gold mineralization which clearly suggests they could be at the edge of something much more significant.  VGD now has a trail – they just need to follow it.

Visible Gold Mines announced August 16 that nine holes have been completed at Wasa Creek (assay results are yet to come on eight of them) and aggressive drilling continues.

Two drill rigs are concentrating on the area around LBWC-11-03 with 50-metre step-out holes and a “wall” of holes to the east in a north-south direction for 1.5 kilometres crossing the Cadillac Fault.

But the story gets even more interesting.

Drill targets are being finalized at Wasa East which also looks very intriguing.  The VGD geological team, which we have a tremendous degree of confidence in as we’ve already outlined, sees a possible connection between the Wasa Shear Zone and the Cadillac Fault which are on either side of Wasa East.  It seems some secondary faults are present which bodes well for the potential discovery of mineralization on that property.  Here’s an important quote from the August 11 news release:

“Geophysical anomalies indicate there could be many parallel zones to the Wasa shear and the Cadillac fault, and ground surveys show the presence of a fault suggesting a direction which can connect both gold-bearing systems. Historically, very little exploration work has been carried out at Wasa East, and the company is looking forward to testing the potential of this area.”

Wasamac is going to be one of the most important stories along the Cadillac Trend for many, many months and Visible Gold Mines is in the heart of the action.  I suspect they’re trying to get their hands on even more ground in the area.

Note: The writer holds positions in Richmont Mines, Visible Gold Mines and Cadillac Mining.