The following is Ventures' recently published newsletter:
From the President
On behalf of the management and board, I am pleased to introduce Ventures' second newsletter to update shareholders on the latest developments within the company.
When you received our first newsletter last fall, Ventures was in the midst of a very busy drilling season. At that time we were anticipating positive results - financially from an equity partner, and geologically from the continued exploration of our property portfolio in Alaska.
Now four months later, I am happy to report that we have obtained excellent results from each of our 6 exploration programs and have a new financial partner, Teck Corporation.
On behalf of the Ventures team, I urge you to take a few minutes to review last year's accomplishments and to examine our corporate and exploration plans for the upcoming year.
Yours truly,
R. Greg Sheardown
President & CEO
Teck Corporation Financing Announced
In December, Ventures announced that it closed a C$4.1 million financing with Teck Corporation, the proceeds of which will be applied to Ventures' Veta block. Following the exploration phase of this agreement and an additional C$3.5 million, Teck is entitled to select and earn a 60% interest in one project upon the completion of a feasibility study.
The Veta block contains two mid-stage projects (MSPs) and 24 early stage prospects. It is located in east central Alaska in the immediate vicinity of Sumitomo and Teck's recently discovered 4.5 million ounce Pogo gold development project. The property covers approximately 1,500 square miles between Pogo and the Yukon border.
Management expects that this transaction will provide the financing required to thoroughly explore the Veta property. Concurrently it provides Ventures with the flexibility to pursue similar arrangements with other companies on its five other property blocks.
Ventures' shareholders retain the majority of the potential value created through exploration success in the block. Teck and future investment partners gain access to Ventures' diversified exploration portfolio, which happens to be in a pro-development state with an impressive heritage of successful mines.
Exploration
Field operations were performed on all six properties during 1997. All programs were completed within budget and according to plan. Accomplishments include:
Veta Property
Exploration on both the Eva and Mitchell mid-stage projects (MSPs) consisted of trenching and reconnaissance geology. Values of 19.4 ounces per ton (opt) silver, 28.7% lead, 9.4% zinc, 0.28% copper and 0.003 opt gold were obtained from an 18 foot wide trench at Eva. At the Mitchell MSP, high-grade silver, copper, zinc and gold mineralization were discovered through trenching. Both MSPs are priority drilling targets for the 1998 season.
Towards the western edge of our Veta property, in the vicinity of the recently discovered Pogo gold deposit, extensive staking programs are being carried out by other mining companies. Ventures has several early-stage gold prospects in this region and continues to control the largest land position in the area.
Flat Property
The discovery of high-grade shear zones located in the center of a 12,000 foot by 2,000 foot gold anomaly represents a significant accomplishment.
Drilling in these zones returned values up to 70 feet assaying 0.416 opt. This included a 4.5 foot zone which assays 6.16 opt gold. Trenching along the 1,200 foot shear zone returned assays of 90 feet of 0.193 opt gold including 5 feet of 2.89 opt gold. These results included the highest values obtained to date by drilling and further enhance the potential of the project.
The Golden Horn mine is located on the north side of the 144 square mile Flat property, five miles north of Chicken Mountain, where a new zone of mineralization was identified through drilling. Results included values of 25 feet of 0.274 opt gold and numerous trenches assay between values of 0.1 and 0.2 opt gold over lengths ranging from 5 to 60 feet.
Champion Property
The best results of the season were obtained at the Lead Creek MSP. Drilling identified a horizon of massive sulfide mineralization indicative of a Sedex massive sulfide deposit. The surface mineralization extends for 15,000 feet by 6,000 feet.
The good news is that we confirmed the existence of this style of mineralization through drilling, however, the grade and width of mineralization need to be higher. This is typical of Sedex deposits that sit in the ground like an "upside-down dinner plate". WGM Inc.-our project operator-believes that our drilling has located the edge of the plate and the key is to now work towards the center where both grade and width should increase.
Two of the seven core holes intersected the stratabound massive sulfide horizon. Hole LC-7 intersected 7 feet of massive sulfides grading 4.51 opt silver, 7.2% lead, and 0.2% zinc. A 3.5-foot interval in this horizon assays 8.8 opt silver, 14.2% lead and 0.3% zinc.
Hole LC-9, approximately 200 feet from LC-7, intersected an 18 foot interval of the massive sulfide horizon grading 2.6 opt silver, 2.1% lead, and 1.5% zinc. Assay results within these intervals had up to 5.05 opt silver, 5.1% lead, and 2.8% zinc.
Wiseman Property
Trenching work on the Luna MSP confirmed the existence of high grade mineralization. A 30 foot channel sample assays 3.44% copper, 3.11% zinc, 0.1% cobalt, 1.25 opt silver and 0.014 opt gold. Furthermore, at the Venus MSP, our geologists discovered a new zone of outcropping mineralization adjacent to a large 5,600 foot by 1,000-foot surface copper anomaly. This outcrop assays 3.22% copper, 0.081 opt gold and 1.8 opt silver across 20 feet.
The Company plans to analyze forthcoming results of an airborne geophysical survey conducted over a large portion of the Wiseman property by the U.S. Bureau of Land Management.
Seventymile Property
Airborne geophysics clearly identified a six mile zone of known surface gold mineralization along the Flume creek trend towards the western boundary of this 1,000 square mile property. Prior drilling already identified six separate gold MSPs on the property with several drill intersections ranging from 168 feet of 0.04 opt gold to 3 feet of 1.45 opt gold.
Administration
While it has been a tumultuous year for the mining sector in general, it has also been a year of significant accomplishments for Ventures. They include the reporting of good drill results from our properties, the signing of a financial partner, and attracting several senior mining firms interested in securing rights to co-explore our properties.
Our corporate strategy is focused on attracting senior companies to co-fund our projects while improving our balance sheet whenever possible. Management recognizes that our first commitment is to create value for our shareholders, so we are determined to press ahead with our mineral discovery plans.
On December 29, 1997, Ventures completed a private placement of C$1 million. When combined with the Teck Corporation equity placement, total capital raised for December surpassed C$5 million. We are confident that further equity or joint venture partners will be announced in 1998 on some or all of the Company's five other property blocks.
Ventures plans on spending approximately C$3 millionon exploration in 1998 with funds being directed to the Veta, Flat and Champion properties.
Exploration programs on our other properties will be determined by the availability of additional funding and by attracting further equity partners. We believe our conservative approach during these uncertain times will contribute to our future prosperity.
For more information please contact:
Ian Klassen, Investor Relations
Toll-free: (800) 711-4145
Or visit our web site at www.venturesresource.com |
