Chile-focused gold company Tesoro has reported maiden ore reserves of 1.28 million ounces at its Ternera deposit, part of the overall El Zorro project.

The 42.8 million tonnes grading 0.93 grams per tonne gold were estimated using a US$3000/oz gold price.

The reserves are contained within a single pit that will feed a 3Mt-per-annum processing plant.

Recent scoping work completed by Tesoro envisaged annual average production in the first 11 years of operations of 111,000oz at all-in sustaining costs of $1216/oz.

Pre-production capital has been estimated at US$276.5 million.

A definitive feasibility study is due to be completed next quarter.

Tesoro had A$15.3 million cash and cash-equivalents at the end of June.

Multinational gold miner Gold Fields has a 12.9% stake in Tesoro.

Its interest will extend beyond the initial Ternera development.

As per standard, Tesoro believes Ternera is just the start.

"It was the first major target we drilled systematically across an almost 50km mineralised belt and has already grown into a multi-million-ounce gold deposit," managing director Zeff Reeves recently promoted at a conference.

"We find it difficult to believe that a district of this scale and quality hosts only a single major discovery."

Shares in Tesoro were up 3% to 89c during a positive session for the ASX gold sector.

At that price Tesoro, has an enterprise value of about $150 million.

Late last month, Canaccord had a $2.20/share price target.

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