Wednesday, 23 May 2012

Corvus Gold hits 5.4 metres of 16.2 g/t gold at Yellow Jacket Zone, North Bullfrog

Corvus Gold (TSE:KOR)(OTCQX:CORVF) unveiled Wednesday the latest results from diamond drilling in the Yellow Jacket Zone at the company's North Bullfrog project near Beatty, Nevada, opening up what it called "significant potential" for expanding the mineralization in the area.
The precious metals miner said that hole NB-12-138, which is outside the current in-pit resource as reported in the preliminary economic assessment in February, is the fifth core hole to be drilled in the Yellow Jacket Zone that encountered high-grade gold mineralization.
This latest intersection returned three separate high-grade intervals, with the best being 16.2 grams per tonne (g/t) gold and 1,218 g/t silver over 5.4 metres, including 2.1 metres of 33.0 g/t gold and 2,870 g/t silver within "quartz veined hydrothermal breccia", the company said.
Corvus also said the high grade intervals found also have elevated selenium and tellurium values - similar to those reported in the silver-rich, gold mineralization found at the historic Bullfrog Mine, which is roughly 10 kilometres to the south of the North Bullfrog project.
The results continue to show the continuity of the structurally controlled, high-grade gold mineralization previously reported from this area in March, the gold and silver miner said.
"The high-grade gold and silver mineralization encountered in NB-12-138 continues to confirm our covered, feeder zone target concept, opening up significant potential for expanding this very attractive zone of mineralization," affirmed CEO Jeff Pontius.
"This style of high-grade mineralization has produced exceptional deposits throughout Nevada and we are excited about further defining its potential on the North Bullfrog project."
The Yellow Jacket target is in the northern part of the district, currently outside existing pit perimeters.
Five diamond drill holes along the Yellow Jacket structural corridor have hit what the company calls "an extensive" structural zone with multiple styles of gold mineralization, including both quartz veining and pyrite replacement of iron-rich lithologies.
The company said that the style of quartz veining found in the latest hole NB-12-138 is different from that found in the other holes, and represents "a more dynamic and productive part" of the Yellow Jacket feeder zone system.
This is because the new veins are associated with multi-stage hydrothermal breccias, with the highest grades associated with visible gold and acanthite, a high-grade silver mineral.
Prior to the latest intersection, most of the observed quartz veining that hosted high-grade gold has been relatively uniform textured milky grey quartz with pyrite, the company added.
"This current high-grade zone displays evidence of very active boiling at depth and bodes well for discovery of more elevation controlled high-grade mineralization at depth along this broad, +2 kilometre long structural target," Corvus said in a statement Wednesday.
The North Bullfrog project 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, which is adjacent to a major highway and power corridor, is made up of a number of leased patented federal mining claims and 461 federal unpatented mining claims.
The current drill program at North Bullfrog is focused on infill drilling, and advancing metallurgical work as well as environmental baseline characterization studies, with the aim of completing a feasibility study by early 2013 on the Mayflower deposit.
In February, the company released a PEA on the property, which produced an economic analysis for a conceptual, low capex, heap leach project that generates average annual gold production of 57,700 ounces over 12.8 years.
This indicated 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.
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.
Total initial capital expenditure was estimated at $68.8 million with a 2.6-year payback period.
North Bullfrog currently includes several prospective gold targets with four - Mayflower, Sierra Blanca, Jolly Jane and Connection - containing an NI 43-101 compliant estimated indicated resource of 24 million tonnes at an average grade of 0.29 grams per tonne (g/t) gold for 224,400 ounces of gold.
These same four targets hold an additional inferred resource of 468 million tonnes at 0.19 g/t gold for 2.84 million ounces of gold  (both at a 0.1 g/t cut-off), with appreciable silver credits.
Last week, Corvus closed a $5.5 million non-brokered private placement financing, providing the company with financing to rapidly advance mine development of North Bullfrog, as well as to continually explore the new high-grade Nevada gold discovery, it said.
The explorer sold 8.25 million common shares at a price of 67 cents, with over 50 percent of the placement taken up by management and insiders, with CEO Jeff Pontius purchasing one million shares - a major show of confidence for the company.
In late March, the company reported initial results from the Yellow Jacket higher grade feeder zone as part of a phase one feeder zone exploration program. The Yellow Jacket target is one of several in the North Bullfrog District that the company will be exploring this year.
These initial higher grade intervals were from holes about 400 metres to the northeast of the proposed Sierra Blanca pit and resource, the company noted at the time.
Highlights from the diamond drilling at Yellow Jacket in March included 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.

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