Canamex Resources (CVE:CSQ) (OTCQX:CNMXF) shares shot up after the company said that the Nevada Division of Water Resources has granted it a subsurface water right for its Bruner gold project in the state.
The water right application, which was submitted last April, was approved by Nevada's State Engineer, with the company now having a water right for mining purposes for 0.78 cubic feet per second on the west side of Bruner.
This combines with the 0.10 cubic feet per second which came with the patented ground and the well location on the east side of the property, said Canamex, thus providing a total of 400 gallons per minute of beneficial use for mining purposes.
The company said this should be enough water for the development of up to an 8,000 tonne per day initial heap leach operation.
"The issuance of sufficient water rights for an initial heap leach operation at Bruner follows the company's plan of anticipating development needs for the project and paralleling resource development and project development to facilitate moving the project forward expeditiously at the appropriate time," said president and COO Greg Hahn.
In order to perfect the water right, the company has to complete a well at the permitted location by December 30, 2016, and then place the well into beneficial use by the end of 2017.
Canamex said it will soon begin permitting for a well site to go with the new water right. Meanwhile, the junior explorer is also progressing with its maiden resource report for the property, which is expected by the end of the first quarter.
The report is anticipated to cover resources at the historic area, as well as those at the new Penelas East discovery and the Paymaster zone.
Shares jumped over 13 percent to 17 Canadian cents on Thursday.