The Water Tank Hill deposit's resource totals 318,000 tonnes at 6.1 grams per tonne gold for 63,000 ounces of gold.

The increase brings total resources accessible from Mt Magnet’s St George decline to 743,000t at 5.2gpt gold for 125,000oz gold.

A mining study to assess the economic viability of the project is expected to be completed in the June quarter of 2013.

The company said Water Tank Hill produced 214,400t at 6.6gpt gold for 45,356oz of gold in the 1980s and 442,232t at 1.8gpt for 25,187oz gold from an open pit in the 2000s.

Mineralisation at the deposit appears to be open downplunge with potential to further increase resources from future underground drilling.

Between 2005 and 2007, St George produced 593,000t at 5.3gpt for 100,590oz gold.

The mine was closed as part of previous owner Harmony Gold Australia’s overall closure of Mt Magnet operations.

Shares in Ramelius were trading 3.3% up today at A37c.