De Grey Mining (ASX:DEG) said results from infill and extension drilling at the Eagle deposit at the Hemi gold project in Western Australia boosted future underground mining potential, according to a Tuesday Australian bourse filing.

The company completed an initial program including 13 diamond drill holes targeting a small area of the Eagle mineral resource estimate beneath the definitive feasibility study pit design.

The drilling intersected mineralization where expected, and the results include an intersection of 78.1 meters at 7.9 grams per tonne (g/t) grade of gold from 457 meters, as well as another of 23.9 meters at 5.1 g/t grade of gold from 425.1 meters.

The company said high-grade mineralization was confirmed to extend beneath the open pit mineral resource and definitive feasibility study open pit designs. If further studies are successful, it will conduct underground development for potential underground production in parallel with open pit mining.

It proposed conducting additional metallurgical testing as well as geotechnical and hydrological studies on a potential Eagle underground operation to a scoping study level.

The firm's shares fell almost 2% in recent trading on Tuesday.