1998 Program
The area of the property is over 55 square miles. The scope of the exploration
program is immense. There are a number of known mineral occurrences and
new ones are being added with each program. Since 1997 at least 4 new
discoveries have been made and there are large numbers of older shallow
mining projects, which have been discovered and operated since the early
1900's. It is thought that many of these shallow deposits combine with the Bald
Mountain intrusive "heat engine" may be indicators that deeper deposits may be
present.
During 1998 Kinross Gold became a joint venture partner on the project in
February of 1998 by agreeing to spend $ 10 million CDN over four years to earn
an initial 50 percent. At the beginning Kinross spent a few months reviewing the
existing data from previous programs and mining operations, then commenced
the drilling program in July. Initially known mineral occurrences in the south
end of the property were drilled. Later the drilling program moved towards the
north. In addition, some step out type holes were drilled in areas that were
considered to be promising.
At Elliot High Ranch, in the SE corner of the property, results were consistent
with results from the 1997 program in that mineralization and lower grades
were consistent with past work. Results from the more northerly Bunker Hill and
POD Deposits were impressive. In particular, at the POD deposit, potential
reserves at economic open pit gold grades were greatly enhanced. Additional
higher grade holes were also drilled at Bald Mountain.
Hole number 49 drilled about half way between the POD Deposit and Bunker Hill
was a major intersection at 70 feet of 0.110 oz/ton. This may indicate the
potential for a Rain Type deposit. Kinross has stated: "The geologic setting and
the host rocks are largely similar to those at the nearby Rain deposit where
Newmont produced more than 1 million ounces from an open pit and is
currently developing an underground resource". In a conference call held in
mid-January, Kinross added: "A mineralized fault running NW_SE has been the
centre of most drilling, looking for Carlin-type deposits similar to Newmont's
nearby Rain mine, where deep drilling has apparently outlined 2-3 million oz Au
at a grade of 0.20-0.30 oz Au/t"
1999 Program
At this time it appears that the drilling program has developed two intersecting
geologic structures on the POD Deposit, which have a high potential for further
development. The area between Bunker Hill and POD should bear further
investigation. In addition, Bald Mountain is showing strong potential. Early in
1999 there may be a period where results from the drilling program are under
evaluation. However, further results from the1998 drilling program are expected
early in the year. Later, in the spring, weather conditions permitting, Kinross has
indicated they will resume the drilling program. At this time, the budget for the
1999 has been set at $2 million.
It should be emphasized that the project is not the exploration of a single
mineral occurrence but the exploration of what amounts to an entire Carlin type
window. If the history of the Carlin Trend and the Railroad property itself are
indicators the exploration program is aimed not at a single deposit, but a
number of deposits. All of the indications from drilling, past work, as well as
geologic conditions are present to indicate the existence of more than one
economic deposit on the Railroad Property.
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