Cusac Gold Mines: Gold Production Resumes at Table Mountain; Increased
Production and Exploration Forecast for 1999; Tailings Pond Contains 28,000
Ounces of Gold
VANCOUVER, BRITISH COLUMBIA--Mr. Guilford H. Brett, President,
reports that gold production of approximately 1,000 ounces was
achieved from surface mining of the Bear Vein and significantly
higher production is planned commencing spring 1999 at the
Company's Cassiar Gold Property in North Central B.C. Cusac is
the 100 percent owner and operator of the high-grade Table
Mountain Gold Mine and 300 ton per day mill and has recently
optioned and can earn up to 70 percent of the adjoining Taurus
Gold Project where a bulk tonnage, low-grade resource of over
1,000,000 ounces has been outlined. Cusac can mine up to 250,000
tonnes per year subject to a 2.5 percent net smelter royalty.
Also, after considerable research, Cusac has determined that its
Table Mountain tailings pond contains over 28,000 ounces of gold
in material grading 1.25 grams/tonne. Preliminary test work with
a local recovery systems firm has indicated that 70 percent of
this gold can be recovered. Initial economic scoping suggests
significant financial benefits.
Mining of the Bear Vein will continue underground during the
fourth quarter, with ore stockpiled for milling in the spring of
1999. On the Taurus project, a number of targets have been
identified for possible 1999 high-grade surface and underground
mining. These areas include the Central Vein where a
drill-indicated reserve has been outlined of 32,500 tons grading
0.628 ounces per ton gold.
Formerly under option to Cyprus Canada, exploration on the Taurus
Project has totalled over $4 million, including over 100 drill
holes. This work has led to a number of gold resource
calculations for a number of large mineralized zones on the
property. One estimate completed in 1995 by Cyprus is as follows:
/T/
88-HILL ZONE PLUS HIGHWAY ZONE
Avg Horiz Avg Grade
Zone Width (m) (g/t) Tonnes Grams Ounces
A) 88 Hill
0.5 g/t cutoff 10.0 1.40 22,462,728 31,514,465 1,013,213
0.7 g/t cutoff 9.4 1.56 18,740,864 29,225,029 939,606
1.2 g/t cutoff 8.9 1.98 11,092,209 21,921,647 704,797
1.5 g/t cutoff 7.8 2.35 7,087,743 16,629,048 534,636
B) Hwy Zone
0.5 g/t cutoff 8.2 1.20 5,945,461 7,130,066 229,237
0.7 g/t cutoff 8.6 1.28 5,235,183 6,712,190 215,802
1.2 g/t cutoff 8.9 1.84 1,924,203 3,538,017 113,750
1.5 g/t cutoff 9.7 1.88 1,760,739 3,303,094 106,197
C) Total of 88 + Hwy
0.5 g/t cutoff 9.1 1.36 28,408,189 38,644,531 1,242,450
0.7 g/t cutoff 9.0 1.50 23,976,047 35,937,219 1,155,408
1.2 g/t cutoff 8.9 1.96 13,016,412 25,459,664 818,547
1.5 g/t cutoff 8.8 2.25 8,848,482 19,932,142 640,833
D) 88 Hill Pit
0.5 g/t cutoff 10.3 1.45 18,215,057 26,422,869 849,515
0.7 g/t cutoff 9.8 1.67 14,493,194 24,133,433 775,908
1.2 g/t cutoff 9.5 1.91 9,027,846 17,250,996 554,632
1.5 g/t cutoff 7.9 2.50 5,680,584 14,196,804 456,438
/T/
In summary, the above calculations suggested the combined 88-Hill
plus Highway Zone resource is 28.4 Mt at an average grade of 1.36
g/t Au (0.040 opt, 1.2 million ounces). The average width would
be about nine meters.
Cyprus Canada withdrew from the project in 1996. International
Taurus Resources Inc assumed control at that time and completed
five additional diamond drill holes and thirty-six
reverse-circulation drill holes. Based on the results, Taurus
commissioned a new resource estimate, pertaining to the 88-Hill
area only, that calculated:
/T/
Drill indicated reserves:
13,586,000 tonnes grading 1.01 gpt containing 442,197 ounces.
Drill Inferred reserves:
27,355,000 tonnes grading 0.67 gpt containing 585,693 ounces.
/T/
The above estimate assumed that all of the material within 88-Hill
would be mined, waste included, and, as such no cut-off grade was
used. Cusac geologists believe that there is potential to better
define discreet zones of mineralization within 88-hill of
sufficient grade for a low cost, 500 ton per day operation.
Cusac's existing mill can be modified to operate at up to 500 tons
per day.
TAILINGS POND
There are currently two tailings ponds at the Table Mountain Mine;
an "old" pond and a "new" pond. The new pond was constructed by
Cusac in 1993-94 and has been used exclusively by Cusac. The
"old" pond contains all the tailings from production prior to
Cusac taking over operations. Testing of the old pond carried out
during 1997 and 1998 by Cusac research engineer V. Zhuravlev,
M.Sc., Ph.D., has estimated that the pond contains 700,879 tonnes
grading 1.25 grams per tonne Au, containing 28,202 ounces of gold.
A variety of recovery methods and processes have been tested. One
commercially available system has shown in initial tests that 70
percent of the contained gold can be recovered in a relatively
simple and inexpensive circuit. Pre-feasibility work is now
underway with the objective of commencing operations in the spring
of 1999.
REPORT COMPLETED
A recently completed independent engineer's report on Cusac's
Cassiar gold camp by Consulting Geologist Dale Sketchley, M.Sc.,
P. Geo., identifies numerous promising targets for both high and
low grade mineralization. A $2.3 million exploration program has
been proposed. Cusac is currently seeking funding for its
exploration and development programs.
Cusac Gold Mines Ltd.
Per/ Guilford H. Brett, Vice President and Director
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
Cusac Gold Mines Ltd.
Guilford H. Brett
1-800-670-6570
cusac.com
e-mail: cusac@uniserve.com
The Toronto Stock Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this news release.
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