Eastmain raising $14 m for Eau Claire

Vancouver – You might say they have golden eyes at Eastmain Resources (ER-T) with the June 12 announcement of visible gold in 34 of 51 holes drilled during its 2007 program at Eau Claire, northwestern Quebec, about 200 km east of James Bay. The next day Eastmain lined up a $14 million private placement.

According to the company, the latest drill results could boost Eau Claire’s resource estimate that stands at 1 million indicated tonnes grading 9.46 grams gold per tonne and 3 million inferred tonnes grading 6.90 grams gold.

The 2007 program zeroed in on the 450 West zone, the central part of a series of gold-bearing veins 1 to 9 metres thick so far covering a 300 metre wide, 1,500 metre long, and at least 750 deep area that is open in all directions.

The company reports that visible gold occurred relatively evenly across the drill grid, and was found from the surface to a depth of 60 metres (deeper drilling was completed in past years).

Some of the more significant results were: a 1.0-metre interval in hole 82 starting at 43.4 metres grading 85.82 grams gold and a 3.5-metre interval in hole 87 grading 79.76 grams gold.

In the private placement Eastmain will issue 10 million units priced at $1.40 apiece with each unit comprised of half of a share and one half of a warrant expiring two years after closing. Each whole warrant can be converted into a share for $2. The placement included a 1.5 million unit overallotment under the same terms.

Eastmain acquired a 50% interest of the property in 1996 from Westmin Resources (since purchased by Boliden which in turn sold its Canadian assets to Breakwater Resources (BWR-T) in 2004) for 200,000 shares and a 3% net smelter return royalty (NSR). In 2001 Eastmain purchased the NSR for $45,000 and in 2004 it bought out the remaining 50% interest then held by Quebec government owned SOQUEM.

The Eau Claire property is part of Eastmain’s focus on gold in Ontario, Quebec, and New Brunswick. Westmin Resources originally outlined a 6 km long gold-in-soil anomaly, and visible gold in the southeastern, and peripheral vein B. But Eastmain reports that the main mineralized area, or what the company calls the “Main Group of Veins” or MGV, was not discovered until 1999 after a season of trenching and stripping.

This year Eastmain plans to drill to the east of 450 West, complete a scoping study, and get the provincial government’s approval on a 2.5 km all-winter road to access the property.

On news of the drill results Thursday, June 12, Eastmain’s share price increased 8 to close at $1.44, then after announcing the private placement Friday it slid 7 to close at $1.37. Over the last 52 weeks the company traded between 57 and $1.68.