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BHMNF:BB/BMD:ASE Today is the talk :
Management, on behalf of the shareholders, would like to thank the Board of Directors for their advice, council and time commitment to Birch Mountain Resources Ltd.
We are very pleased that Dr. Hugh Abercrombie, formerly with the Geological Survey of Canada, has joined our staff. Hugh has been at the forefront of the conceptualization and development of the Prairie Gold model and will be a valuable addition to our staff in pursuing these deposits in Canada and, in time, worldwide.
List
Q. Why do you believe there is gold in northeastern Alberta?
A. "Scanning electron microscope and standard fire assay analyses have conclusively demonstrated the presence of anomalous quantities of gold and other precious and base metals in rocks in the Athabasca region of northeastern Alberta," says President Doug Rowe. " To explain the transport and deposition of gold and precious metals in Athabasca, Birch Mountain, together with the GSC, developed the Prairie Gold model. With the fire assay results announced in April 1997, we have become increasingly confident in the area's potential."
Q. How significant are your recent fire assay results?
A. "First of all, it didn't happen overnight. Prior to April of 1997, we could demonstrate the presence of gold, but it took two years of work using various methods including fire assay, cyanide leach and flotation concentration at several laboratories before we were able to see repeatable determinations of gold content," says Doug Halbe, Metallurgical Consultant.
"And platinum was a bit of a surprise," adds Bob Lipsett, "although we're certainly pleased that it's there given that it's in high demand. The results - up to 4.94 grams of platinum and 0.21 grams of gold per tonne - are encouraging, but we will need to find the deposit before we can determine just how significant these results are."
Birch Mountain's Chairman, Dr. Richard Garnett, elaborates on the Company's recent news: "Our results are solid. We have three fire assays with similar results from Bondar Clegg and Activation Laboratories, two extremely reputable firms. They obtained the samples independent of Birch Mountain. Birch Mountain has been, and will continue to be, very cautious about releasing results of analytical or extraction analyses."
Q. Do you think the Athabasca region has economic potential?
A."Yes, unequivocally," according to Dr. Hugh Abercrombie, Manager, Exploration. "The conditions leading to the formation of the three-trillion tonne Athabasca oil sands deposit also appear to control the flow of gold-bearing brines. Microdisseminated, sediment-hosted gold deposits, such as Carlin in Nevada, typically form over a few hundred thousand years to a million years. In contrast, mineral deposition in northeastern Alberta occurred over a much longer period, perhaps tens to hundreds of millions of years. This, and other factors, lead us to conclude that there is tremendous potential for the formation of large-tonnage deposits in Alberta that could rival some of the largest gold deposits in the world."
Q. Where and how do you expect to find an economic gold deposit?
A. Dr. Jon Thorson, Exploration Advisor, responds: "In our exploration program, we are using geology, geophysics and geochemistry to correlate Prairie Gold mineralizing processes with the structural, stratigraphic, hydrogeological and geochemical elements that are essential to the formation of an ore deposit. The Prairie Gold model tells us that an ore deposit in Athabasca will be found in a large volume of fractured limestone containing gold, silver and other precious and base metals. Evidence from other sediment-hosted gold deposits further suggests that an ore deposit will be found where structural and stratigraphic conditions enabled brines to flow into areas that had the ability to capture metals."
Q. Where else would the Prairie Gold model apply?
A. "The first area is Dawson Bay in Manitoba, where Birch Mountain has acquired a Special Exploration Permit covering 530,000 hectares. New occurrences of microdisseminated gold and polymetallic minerals were discovered here in 1996 by the GSC and Manitoba Energy and Mines," says Hugh Abercrombie. "We believe we can recognize and identify occurrences of this mineralization elsewhere in the WCSB and in other basins around the world that show geological, geochemical, structural and hydrogeological features similar to Athabasca and Dawson Bay." He also adds that "Birch Mountain has initiated a program to review and prioritize regions in and outside of North America that have the potential to host other Prairie Gold deposits."
Q. Do you have the financial resources to meet your objectives?
A. "Yes," replies Don Dabbs, Chief Financial Officer. "In 1996, we raised $9.2 million in a private placement, and subsequent to year-end 1996, we announced the extension of the Company's outstanding warrants to October 11, 1997. We have developed a two-year operating budget, and we have a strategy to attract joint-venture partners to ensure we can fund our exploration programs in western Canada."
Glossary
ASE:BMD
Birch Mountain Resources Ltd.
3100, 205 Fifth Avenue S.W.
Calgary, Alberta Canada T2P 2V7
Tel. 403 262 1838 Fax 403 263 9888
birchmountain.com
This stylized cross section illustrates the Prairie Gold process under the Alberta Oilsands, north of Fort McMurray.
In conjunction with the Geological Survey of Canada, Birch Mountain has developed the Prairie Gold model for deposition of gold and precious metals in sedimentary rocks. The Prairie Gold model guides our search for a gold deposit in this area. It explains how gold and other metals were transported by low-temperature fluids in the Western Canadian Sedimentary Basin (WCSB) and were deposited in host rocks in Athabasca. There are five critical elements of the Prairie Gold model: a brine solution; source rocks; a plumbing system; a precipitation mechanism; and time. All elements of the Prairie Gold model are present in Athabasca.
The solution capable of carrying gold is an oxidized chloride-rich brine generated as the residual saline solution remaining after salt deposition during Early and Middle Devonian times. In addition, chloride-rich brine is generated when meteoric water enters from the surface, flows through the sedimentary rock and dissolves the deposits of salt.
The source rocks must contain some gold and precious metals and be sufficiently porous and permeable to allow the brine to circulate. In Athabasca, the source rocks are fractured Precambrian basement which extend along the eastern margin of the WCSB.
The plumbing system by which the metal-bearing solutions flow to the site of deposition is a combination of structural and stratigraphic fluid conduits including permeable aquifers, faults, fractures and solution collapse features. The structural history of the eastern part of the Peace River Arch is an integral part of the Prairie Gold model in Athabasca. Over geological time, structural adjustment of the Peace River Arch fractured the sedimentary rocks and provided conduits for transporting metal-bearing solutions.
The precipitation mechanism for removing gold and precious metal from solution is reduction of the oxidized, chloride-rich brine by reaction with either sulphides or organic material. It takes time for these solutions to transport a sufficient quantity of gold. In northeastern Alberta, gold and precious metal transport and deposition has occurred for tens to hundreds of millions of years.
Applying the Prairie Gold model, we believe an ore body in Athabasca will be discovered in a large volume of fractured, altered limestone that contains gold and precious metals with minor amounts of copper, zinc and other metals. The location of such an ore body will be controlled by stratigraphic features and will reflect the distribution of both permeability and precipitation mechanisms, likely related to solution collapse features. The Bitumount Basin meets this description and will be the focus of our exploration program.
Precious Metal Enrichment=
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Precious Metal Enrichment
In Alberta, our geologists have identified anomalous precious metal enrichment, alteration and structures essential to the Prairie Gold model. We now consider that the gold and platinum observed in Athabasca, Alberta is representative of a low temperature end-member of sediment-hosted precious metal deposits such as the Carlin gold mine in Nevada.
On April 3, 1997 we announced independent fire assays confirming gold and platinum on our Athabasca property in northeastern Alberta.
Bondar Clegg
Bondar Clegg
Activation Labs
Gold (grams/tonne)
Platinum (grams/tonne)
0.20
4.94
0.19
2.21
0.21
2.21
Significant progress has been made towards the discovery of a potential sediment-hosted gold-platinum deposit on Birch Mountain's Athabasca property in northeastern Alberta. Over the past year, Birch Mountain has concluded that the Prairie Gold model, probably represents a low temperature variant of certain uncomformity-related, sediment-hosted gold deposits in Nevada that are not associated with intrusive or volcanic heat sources. This recognition has primarily been driven by our detailed examination of cores obtained from oil sands operator Syncrude Canada Ltd. and structural mapping using core-based information combined with results of our 1997 23,000 line kilometer high resolution aeromag survey.
We have concluded that in addition to the Athabasca area in northeastern Alberta, the Dawson Bay region of west-central Manitoba is another area where Prairie Gold mineralization occurs. Scanning electron microscope work on samples from this area has identified altered rock hosting gold grains in association with a wide variety of native metals. Birch Mountain has obtained a Special Exploration Permit from the Manitoba government covering 530,000 hectares in this region. We have entered into a cooperative project with the Geological Services Branch of Manitoba Energy and Mines to document the geochemical characteristics of the host rocks and the gold mineralization in the Dawson Bay area.
Areas of Exploration=
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Chuca
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