Activity on neighboring Elkhorn claims:
Treminco Resources Ltd -
Elkhorn project to be acquired
Treminco Resources Ltd TMO Shares issued 10,508,197 1998-04-22 close $0.42 Friday Apr 24 1998 Mr David Hottman reports Treminco Resources has entered into a letter of intent to acquire the Elkhorn project in Montana from Newmont Gold Company. Under the agreement, Treminco will make initial payments of 550,000 common shares and $1.1-million (U.S.) payable over two years, and subject to the expansion of mineable reserves, further payments of $1.5-million (U.S.) and $1.0-million (U.S.), payable no later than April 30 2003 and 2005, respectively. The six square mile Elkhorn project is an advanced stage gold project on the southern end of the Elkhorn Mountains in Jefferson County, Montana, approximately 22 miles southeast of Helena. Over $12-million (U.S.) has been spent on the exploration and development of the property by a succession of related major mining companies including Gold Fields Mining Company, Santa Fe Pacific Gold and Newmont Gold Company. At Elkhorn, 502 core and 145 reverse circulation drill holes totalling 366,501 feet have outlined a geologic resource of 1,650,000 oz of gold (22.8 Mt at 0.073 oz/t Au, cut off grade 0.02 oz/t Au). A 1996 resource audit by Pincock Allen & Holt calculated a measured and indicated open pit resource containing 955,000 oz of gold (10.8 Mt at 0.088 oz/t Au, cut off grade 0.03 oz/t Au) and a 1995 pre-feasibility study by H.A. Simons calculated an underground mineable diluted reserve of 500,000 oz of gold (3.1 Mt at 0.162 oz/t Au, cut off grade 0.1 oz/t Au). Gold mineralization at Elkhorn occurs within gold skarn deposits. Exploration to date has identified four main deposits within a one square mile area; the Carmody, the East Butte, the Gold Hill and the Sourdough. Highlights from the 502 core and 145 reverse circulation drill holes include:
Hole ID Interval Intercept Grade
(core) (ft) (ft) (oz/t Au)
Carmody Deposit
CEH-057 241-295 54 0.240
East Butte Deposit
CEH-069 28-280 252 0.227
Gold Hill Deposit
CEH-184 0-145 145 0.207
Sourdough Deposit
CEH-330 345-525 180 0.400
All the deposits at Elkhorn are associated with metasomatic replacement of calc-silicate hornfels and marbles by diorite to quartz monzonite intrusive bodies. Near vertical mineralization along the intrusive contacts and stratabound sediment hosted mineralization occurs within each of the deposits. Skarn formation is greatest, up to 300 feet thick, where the stratabound zones intersect the intrusive contacts. The deposits have strike lengths of up to 2,000 feet and extend at least 1,000 feet in depth. Gold mineralization occurs as free grains of native gold and as late stage coatings on sulphide minerals. Initial analysis by Treminco, using a life of mine average gold price of $335 (U.S.) per oz, indicates that the Elkhorn project can be developed as a near surface high grade underground mine similar to Pegasus Gold's nearby operating Diamond Hill mine. Analysis using an estimated diluted mineable reserve of 256,000 oz (1.1 Mt at 0.240 oz/t Au, cut off grade 0.15 oz/t Au) and the H.A. Simons underground study, suggests the Elkhorn project could support minimum annual production of 45,000 oz at a cash cost of approximately $230 (U.S.) per oz. This first phase of development will be expanded to accommodate reserve expansion from improving gold prices, operational optimization and exploration successes. The Elkhorn project can be profitably developed at gold prices and the gold resource is highly leveraged to the price of gold. If gold increases from current levels to the $375 (U.S.) to $400 (U.S.) per oz range, the underground mineable diluted gold reserve will double to 500,000 oz. There is also exceptional potential to expand the 1,650,000 gold resource through exploration. New gold resources may be developed from extensions of the known deposits, from other gold prospects and mines within the project land package and from exploring blind targets developed through geophysics, geochemistry and geologic mapping. In total, there are 18 untested drill ready targets on the property. Over the next six months, the company will complete a detailed due diligence review of the Elkhorn project including confirmation drilling and audit, revision of reserves and mine plan, metallurgical audit and a review and update of environmental, permitting and community issues. In addition, the company will start a comprehensive exploration plan to investigate untested drill targets and identify new areas of interest. (c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com |
