Corvus Gold (TSE:KOR) said Thursday that it hit the Yellow Jacket higher grade feeder zone at its North Bullfrog project in Nevada, sending shares up more than 11 percent.
The company reported initial drilling results from select intervals
in the first three holes of a phase one feeder zone exploration program.
These initial higher grade intervals are from holes about 400 metres
to the northeast of the proposed Sierra Blanca pit and resource, along
320 metres of strike and suggest continuity along the north-south
trending zone, open in all directions, the company noted.
The Yellow Jacket target is one of several in the North Bullfrog
District that the company will be exploring in 2012, and is closely
related to the existing resource included in the preliminary economic
assessment released last month.
Highlights from diamond drilling at Yellow Jacket include 11.4 metres
at 4.0 grams per tonne (g/t) of gold and 6.97 g/t silver in hole
NB-12-126 and 13.5 metres of 2.2 g/t gold in hole NB-12-127.
Corvus said it will follow up on these results in a phase two
program, following the completion of its ongoing large diameter core
In addition, phase two will also follow up on results from step out
holes to the west of Sierra Blanca, and step out holes to the north of
Jolly Jane. The program will look to improve confidence and increase the
current resource size through a mix of exploration and infill drilling,
the company said.
"The discovery of the Yellow Jacket feeder zone is very significant
for the North Bullfrog project and Corvus in general as it adds an
entire new dimension to the deposit and its potential going forward,"
said president and CEO, Jeff Pontius.
"We are excited about aggressively pursuing both the potential for a
near-term mining operation and the expansion of this new and exciting
The Yellow Jacket target is in the northern part of the district and
is currently outside pit perimeters used in the preliminary economic
In addition to its ongoing drilling program, Corvus is assessing the
potential for a two stage, fast track development project at North
Bullfrog, with the results expected in May.
The company controls 100 percent of North Bullfrog, which covers
approximately 43 square kilometres in southern Nevada just north of the
historic Bullfrog gold mine formerly operated by Barrick Gold (TSE:ABX).
The property package is made up of a number of leased patented federal mining claims and 461 federal unpatented mining claims.
The project currently includes several prospective gold targets with
four (Mayflower, Sierra Blanca, Jolly Jane and Connection) containing an
NI 43-101 estimated indicated resource of 15 million tonnes at an
average grade of 0.37 g/t gold for 182,577 ounces of gold and an
estimated inferred resource of 156 million tonnes at 0.28 g/t gold for
1.4 million ounces of gold, with appreciable silver credits.
The preliminary economic report produced a robust positive economic
analysis for a conceptual, low capex, heap leach project that generates
an average annual gold production of 57,700 ounces over 12.8 years,
indicating a pre-tax, pre-royalty net present value of $118.3 million
and an internal rate of return of 28.8 percent at a $1,300 per ounce
gold price and a five percent discount rate.
Corvus said that the PEA also showed the project has a considerable
leverage to gold price, with a pre-tax, pre-royalty net present value of
$338 million and an internal rate of return of a whopping 70 percent
at a $1,700 per ounce gold price.
Shares of the company were up 10.4 percent as of 12:19 pm ET at around 85 cents.