HERE IS THE NEWS !
Hampton's First Gold Mine Primera Fortuna Project, Ecuador
CALGARY, Dec. 14 /CNW/ - Hampton Court Resources Inc. (ASE-HCR) is
pleased to announce it has established its first placer gold mine in Ecuador
and intends to commence production in early 1999. The mine, Primera Fortuna
No.1, is situated on one of 16 gold targets identified to date on the
Company's vast land holdings (183.4 sq km/70.8 sq mi). HCR has categorized
these 16 target areas into 7 large volume deposits and 9 smaller volume
deposits.
HCR is now in a position to identify and develop additional mines, of
various sizes and types, and to establish increased gold production throughout
1999 and beyond. HCR's Primera Fortuna No.1 Mine is designed to produce fifty
ounces of gold per day. Cash flow from HCR's first mine will finance an
aggressive, expanded exploration program in 1999 to further document the gold
potential of our concessions.
The data from extensive geologic mapping, sampling, drilling, assaying
and pilot mining has been compiled in 9 geologic reports (7 independent).
Management's assessment of these findings, supported by independent opinion,
indicate that HCR's Ecuadorian Concessions are expected to comprise a
previously undocumented alluvial (placer) gold mining district of world class
proportions.
THE CONCESSIONS
HCR's concessions are located in the Tena area of Central Ecuador. The
Company holds a 100% interest in the exploration rights to 6 mineral
concessions acquired directly from the Ecuadorian government. A 1998
independent title opinion verifies HCR's ownership. Exploration rights can be
held for 6 years and at any time during this period HCR is entitled to convert
its holdings to exploitation permits to allow for long term mining.
THE GEOLOGIC TEAM
The Company organized a team of four highly qualified Ecuadorian
geologists, with backgrounds in placer gold exploration and development, to
map and evaluate land holdings in Ecuador. HCR also engaged Prudden
GeoScience Services Inc. (''PGS'') of Salt Lake City, Utah to oversee our
geologic team and to provide an independent opinion of the gold potential of
the concessions.
HCR personnel provide all logistic support to both our geologic team and
PGS throughout Ecuador.
THE GEOLOGIC MAPPING AND SAMPLING
Regional and detailed mapping has enabled preparation of a Geologic
Stratigraphic Column for the district comprised of thirty three (33) distinct
units ranging in age from Recent alluvium through the Jurassic granite
bedrock. A comprehensive geologic map has been prepared on a scale of
1:25,000 covering our entire land holdings.
In addition to geologic mapping, a total of 1,338 specimens were
collected up to the end of September 1998 comprising reconnaissance, channel,
drill hole and bulk samples.
Results of these assays are included in the PGS report 2nd Edition dated
November, 1998. Since preparation of the report over 700 additional samples
have been collected bringing the total to over 2,000 samples since inception
of the project.
THE DRILLING
A total of 47 drill holes have been completed to date on HCR's
concessions representing 820m/2690ft of drilling. HCR is utilizing 2 churn
drills (cable tool rigs) purchased in 1998. HCR's drilling crews have
extensive experience in drilling and sampling placer gold deposits throughout
Ecuador.
Drilling has been underway since Spring of 1998 and will continue until
December 21, 1998 when the crews break for Christmas. Drilling is scheduled
to commence again in January 1999 and will continue uninterrupted throughout
the coming year.
The performance of the rigs to date has been very satisfactory in many
target areas, however, we have encountered difficulty drilling in areas where
large boulders exist. These boulders commonly occur where high gold grades
are present.
HCR is currently negotiating the purchase of a new drilling rig capable
of performing at three times the speed of the current equipment and able to
penetrate boulders. The rig is expected to provide the required information
on the deposits containing boulders as well as considerably increase the
amount and pace of drilling information obtained.
THE SOURCE OF OUR GOLD
Studies completed to date have enhanced HCR's understanding of the
sources of the alluvial (placer) gold present on our concessions.
The original (lode) gold source is believed to be erosion of mesothermal
shear zone hosted quartz veins present in the Cordillera Real basement
lithologies exposed upstream in the Andes Mountains to the west of HCR's
concessions.
Periods of strong erosion from the Tertiary to the present have provided
HCR's concession areas with constant fluvial action resulting in deposition of
placer gold from original sources in the mountains as well as erosion and
reconcentration of previously deposited gold bearing fluvial units.
The auriferous Tiyuyacu Formation (Tertiary-Eocene age) attains
thicknesses of up to 250m/820ft in HCR's concession areas and is present along
a strike length of 150 km. It has features in common with productive
auriferous conglomerates in other locations of the world and of different
ages, (example - the extremely productive South African paleo-placer
deposits). Erosion and reconcentration of the contained gold into younger
fluvial units is believed to be an important source of the gold on HCR's
concessions.
Another source of gold is the younger Tertiary (Pliocene) Chambira
Formation consisting of gold bearing fluvial sediments that attain a thickness
up to 1500m/4920ft.
Reconnaissance sampling and cliff channel sampling were completed by HCR
to evaluate the economic potential of the Chambira and to determine the degree
to which the gold bearing unit is contributing to gold enrichment in the
younger sediments.
The Chambira has been mapped over an area of approximately 39 sq km on
HCR's concessions. PGS estimates that 500m/1640ft of vertical Pleistocene
erosion of this unit has occurred.
Using an average grade of 8mg per cubic meter of gold in the Chambira
(based on channel sampling), PGS estimates that 257,000 ounces of placer gold
per cubic km of erosion has been released and reconcentrated into younger
fluvial units or a total for all the eroded area of approximately 5 Million
ounces of gold.
Sampling of the Tiyuyacu Tertiary gold bearing sands and gravels
established a mean gold grade of 63.6 mg per cubic meter. Erosion of up to
250 meters of the Tiyuyacu sediments over the 22 sq km of the floodplains
provided significant additional amounts of gold. Sources in the Andes also
continue to contribute an unknown quantity of gold to our concessions.
These sources give credibility to the potential of the large areas of
alluvial gold accumulations currently being delineated by HCR.
THE CURRENT GEOLOGIC TARGET AREAS
To date HCR has established 16 separate gold mining prospects. HCR has
categorized these prospects into 7 large volume deposits and 9 smaller volume
deposits.
The 7 high volume targets cover a prospective area of 162 sq km/65 sq mi
and estimates of the combined volumes of all 7 targets range from 600 Million
to 1,015 Million cubic meters of sand and gravel. These volumes are immense
by any standards. Future mapping, sampling and drilling will further define
the volumes present and their contained gold resource. To put the enormity of
our concessions in context if a mean gold grade of 0.145 g per cubic meter is
used (the average grade of HCR's samples, using both economic and uneconomic
samples certified to date); 600 Million cubic meters results in 2.8 Million
ounces of gold being present in these targets and 1,015 Million cubic meters
would result in 4.8 Million ounces.
Higher grades in parts of these deposits would considerably enhance these
figures. Initial testing on all 7 targets indicates that grades exceed the
0.25 grams per cubic meter economic cut off. It is apparent these 7 large
volume targets have multi-million ounce gold potential.
HCR has also identified 9 smaller volume targets as prospective gold
mines. These cover an area of 23.2 sq km/9.3 sq mi and contain an estimated
combined volume of 34 Million to 64 Million cubic meters of gold bearing sands
and gravels. These targets add additional potential based on similar economic
parameters established for the larger mining targets.
HAMPTON'S FIRST GOLD MINE
Extensive geologic mapping, stream sediment and outcrop sampling along
with follow-up large scale bulk sampling has identified an area along the
Chumbiyacu River as the location for HCR's first placer gold mine (Primera
Fortuna No.1).
The area extends for a distance of 4km along the drainage basin of the
Chumbiyacu River. This river has been defined by PGS, utilizing stream
sediment sampling, as the most anomalous (gold bearing) drainage basin within
HCR's concession areas.
Gold is present in this basin in the following geologic deposits:
- the Mera Formation comprising the Chucapi - Chumbiyacu Paleochannel
(parallels the present day course of the Chumbiyacu River).
- the Mera Formation sediments on the adjacent highlands, and
- colluvial and alluvial deposits that have been eroded from the gold
bearing Mera sediments and deposited along the Chumbiyacu drainage
system
Approximately 2sq km of Mera Paleochannel sediments are present within
the Primera Fortuna No.1 mine site. In addition, 8sq km of Mera sediments
have been mapped on the highlands adjacent to this mine site.
Nine near surface small volume outcrop samples collected along the
drainage system averaged 0.59g per cubic meter of gold.
A larger bulk sample recovered seventeen No.6 (6mm diameter) gold grains
(nuggets) which provide a field estimated grade of 4.6g per cubic meter. An
adjacent sample contained eleven No.6 gold grains and a field estimated grade
of 3.5g per cubic meter.
A large scale trench is currently being excavated and to date sampling of
approximately one meter of overburden has confirmed a grade of 0.3g per cubic
meter in the overburden.
Below this overburden, 13.4 cubic meters of gravel have been sampled with
a field estimated grade of 0.43g per cubic meter.
Testing is ongoing and grades are anticipated to increase at or near
bedrock.
PREPARATION FOR MINING AT PRIMERA FORTUNA No.1
HCR completed a 5 km road to the mine site on December 7, 1998 enabling
the company to commence pilot mining on the deposit with our 10cu yd/hr
processing plant. Reported grades to date have averaged 1.3g per cubic meter.
HCR is currently negotiating purchase of the surface rights to these areas and
is in the process of converting our exploration permit to an exploitation
permit. This will allow HCR to proceed with full-scale commercial mining in
the new year.
HCR will move its recently completed 115 cubic meters per hour (150
yd/hr) placer plant to the site in January 1999 and commence full scale
mining. Plans are to run the plant 22 hours/day to maximize daily production.
Mining grades and reserves of gold will be further defined by the ongoing
testing and mining, however, based on test results to date, a minimum mining
grade of 0.5g per cubic meter has been established. This minimum grade is
based on 13 regularly spaced samples taken in the recent alluvium over a 4 km
length. Methods used include reconnaissance, channel and bulk sampling.
This grade will result in HCR recovering 50 ounces of gold per day
(17,000 ounces per year) as the Company mines along the narrow portion of the
Chumbiyacu River drainage. HCR believes that additional gold resources will
be established in the adjacent Mera Formation sediments, however, sampling and
testing of the Mera Formation will be required to confirm the expansion of
this mining site.
Testing and sampling with a skeleton geologic staff will continue
uninterrupted through the holiday season.
Management is optimistic that gold production from our first placer mine
is expected to increase rapidly over the next year as additional processing
plants are put into operation.
ECONOMICS OF PLACER MINING IN ECUADOR
Hampton completed extensive investigations with respect to the economics
of placer gold mining in Ecuador and our concession areas in particular. These
studies also included considerable research on the costs of placer operations
elsewhere in the world that can be used for comparative purposes.
HCR's estimates of mining costs per ounce for the two main types of
mining operations envisioned are $110-$120 US for a small scale open pit mine
and $120-$130 US for a large scale dredging operation.
Many factors affect the actual cost of mining and different deposits will
have varying cost factors. We expect many of the deposits will be low cost
per ounce gold mines. Key factors in this regard are the year round mining
season, warm climate, thin overburden, anticipated good grades, inexpensive
labor costs and favorable fiscal terms on our concessions from the Ecuadorian
Government.
Commencement of production from our first mine in the first quarter of
1999, at a production rate of 115 cubic meters an hour, will provide further
refinement of the mining cost estimates and invaluable mining experience that
can be applied to other potential mine sites on our concessions in the future.
GEOLOGIC RESOURCES ESTABLISHED TO DATE
HCR was delayed in drilling its high priority targets on the south side
of the Jatunyacu River due to unsafe river crossing conditions aggravated by
El Nino.
While waiting for the water levels to subside, HCR drilled 27 churn drill
holes on the north side of the river. Of these holes, 23 were on a low
priority target in the Talag-Shandia Yoked basin area (one of HCR's small
volume alluvial targets). PGS reported in November that this initial phase of
drilling delineated geologic resources totalling 4.2 Million cubic meters with
an average grade of 0.23 grams/cubic meter. The contained gold content was
estimated at 30,800 ounces as outlined in Tables I and II.
This total included 2.7 million cubic meters with an average grade of
211.5mg per cubic meter comprising gold deposited in colluvium and alluvium
derived from extensive erosion of the auriferous Tiyayacu Formation. Also
included is 1.43 Million cubic meters averaging 260mg per cubic meter from
alluvial terraces on the north side of the Jatunyacu which comprise one of
HCR's large volume targets developed primarily on the south side of the river.
<<
Table I
Talag/Shandia Yoked Basin Deposits
-------------------------------------------------------------------------
HCR's Grade Volume
Hole No. Mg/cubic meter Cubic Meters
-------------------------------------------------------------------------
1 258.2 430,600
6 164.6 59,400
7 141.9 373,700
10 314.6 99,000
14 229.1 373,900
16 131.2 36,100
17 140.7 236,000
18 180.3 152,300
19 125.5 500,600
21 262.5 122,500
22(x) 207.6 13,200
25(x) 355.0 371,000
-------------------------------------------------------------------------
Average Grade 211.5 2,768,300
-------------------------------------------------------------------------
Estimated ounce of gold 18,850
-------------------------------------------------------------------------
(x)assays derived from gold count estimates; amalgam assays pending
Table II
Jatunyacu River Terrace Deposits
-------------------------------------------------------------------------
HCR's Grade Volume
Hole No. Mg/cubic meter Cubic Meters
-------------------------------------------------------------------------
5 277.5 1,047,100
9 248.3 93,600
24(x) 294.0 130,000
27(x) 124.3 157,500
-------------------------------------------------------------------------
Average Grade 260.2 1,428,200
-------------------------------------------------------------------------
Estimated ounce of gold 11,950
-------------------------------------------------------------------------
(x)assays derived from gold count estimates; amalgam assays pending
(xx)Other drill holes are non-economic and have not been included in
these Tables. These holes are outside the deposit and do not affect the
grades or resource calculation.
>>
PGS indicates that this initial drilling of the Jatunyacu terrace
deposits equates to a surface factor of 38.0 square meters per ounce of gold.
These results have positive resource development potential considering the
high volumes of alluvium contained in the terraces on HCR's concessions -
approximately 24 square kilometers equating to 630,000 ounces of gold. This
potential will be further documented by current and future drilling and
testing results.
HCR has recently drilled an additional 20 holes, 9 on the north side of
the Jatunyacu River and 11 on the south side of the Jatunyacu River on the 3
lowest terraces.
PGS expects to receive all the assays from the recent drilling early in
the new year and will complete and forward to HCR an expanded resource
estimate at that time.
The 11 drill holes on the south side of the river have been drilled at
0.5 km intervals along the terraces. Only one hole reached bedrock (hole No.
43 at 15.3m/50.2ft).
Based on coarse gold grain counts (not including amalgamated fine gold),
the average grade was estimated at 0.23 grams over an interval of
13.2m/43.3ft. The rest of the holes were terminated in boulders that could
not be penetrated with the churn drills. Potential economic grades in the
boulder layers ranged from 0.25g/cubic meter to 2.5g/cubic meter which
indicates the boulder gravels have a high gold content. HCR's new rig will
evaluate these gold reserves upon arrival on site in the first quarter of
1999.
As previously noted, HCR expects to be mining 50 ounces of gold per day
from its initial mining site on the Chumbiyacu River.
Drilling and sampling will continue throughout 1999 on all 16 potential
mining areas and we will continue to report on our expanding gold resource
base as the data becomes available.
MANAGEMENT ASSESSMENT
Based on the geologic mapping and testing completed to date it is readily
apparent that HCR's Ecuadorian concessions are expected to comprise a
previously undocumented alluvial (placer) gold mining district with
multi-million ounce potential.
The geologic setting of HCR's concessions is remarkably similar to other
world class alluvial gold mining districts that have been developed along the
Pacific Rim in both North and South America. Highlights of these deposits are
as follows:
<<
-------------------------------------------------------------------------
Reported Production
Continent Area (ounces) of Gold Comments
-------------------------------------------------------------------------
-------------------------------------------------------------------------
N. America Klondike district
Yukon +10 Million Discovered in 1896
-------------------------------------------------------------------------
N. America The Caribou
British Columbia +3.0 Million Discovered in 1860
-------------------------------------------------------------------------
N. America Sierra Nevada,
California +55 Million Discovered in 1848
-------------------------------------------------------------------------
S. America The Choco Spanish commenced
Columbia +15 Million mining in 1550
-------------------------------------------------------------------------
S. America HCR's Primera Fortuna Gold Production
Central Ecuador Commencing in Identified by
1999 Hampton in 1998
-------------------------------------------------------------------------
S. America Tipuani River Mined for over 400
Bolivia +11 Million years
-------------------------------------------------------------------------
>>
HCR has maintained a 100% interest in its concessions therefore
controlling both the exploration and development aspects of the Primera
Fortuna Project. The company plans to retain sole ownership.
HCR is now in a position to identify and develop additional mines, of
various sizes and types, and to establish increased gold production throughout
1999 and beyond. Cash flow from HCR's Primera Fortuna Project will finance an
aggressive, expanded exploration program in 1999 to further document the gold
potential of our concessions.
GEOLOGIC DOCUMENTATION AND VERIFICATION
Copies of all geologic reports (including independent opinions) are
available at HCR's office during regular business hours. HCR welcomes
shareholders and interested parties to view the tremendous volume of detailed
information, geologic and geochemical data, and technical maps accumulated
since the inception of our project.
HCR encourages viewing our Website for operational updates and current
information during the coming year.
OVERVIEW
In less than 18 months HCR has discovered, obtained, mapped, surveyed,
tested, evaluated and documented a world class alluvial gold mining district
in Ecuador. We are poised to commence mining on one of 16 established target
areas in the first quarter of 1999.
We will continue to develop our vast mineral concessions, placing
additional mines on production as well as pursue an aggressive exploration
program to establish the full potential of our holdings.
Approved on behalf of the Board: Robert A. McPherson, President
The Alberta Stock Exchange has neither approved nor disapproved the
information contained herein.
%SEDAR: 00007570E
-30-
For further information: INVESTOR RELATIONS: Derek T. Lamb, Ph: (403)
777-9229, Fax: (403) 777-9228, e-mail: lambd@cadvision.com; Deborah D.
Pratt, Ph: (403) 254-9675, Fax: (403) 256-9473, e-mail: pratt@shaw.wave.ca;
HCR Internet Policy prohibits employees and affiliates from posting comments
outside our official Website - web: www.hamptoncourt.com, e-mail:
hamptoncourt@shaw.wave.ca |
