Thursday, 21 June 2012

Millrock Resources says prospect-generator business model allows for continuous exploration activities

Millrock Resources (CVE:MRO) provided Thursday an update on its exploration activities in Alaska and Arizona, securing "substantial" funding for exploration on new and existing projects.
In 2012, partner-funded drilling has occurred on, or is planned for, six different projects - three in Alaska and three in Arizona.
Earlier-stage exploration work will also be completed on five other projects in anticipation of drilling in 2013, the copper and gold explorer said.
Millrock's business model is to identify and package large-scale projects for joint venture. This year, its exploration expenditures are on track to exceed US$11 million, with 90 per cent of the funding being provided by partner companies that are earning-in through option agreements.
As the exploration operator for the projects generated, Millrock receives management fees, as well as option agreement payments during the earn-in phase.
These revenues offset a major portion of the company's overhead expenses, allowing it to remain active in exploration, despite weak economic conditions.
In Alaska, the company's alliance with Altius (TSE:ALS) has allowed it to generate six projects, three of which are under earn-in agreements with other companies. Roughly $500,000 will be spent using strategic alliance funds in 2012 to generate more projects, Millrock said.
With its Vale (NYSE:VALE) partnership for copper-gold porphyry targets in Alaska, the project is budgeted at US$1 million in 2012. Reconnaissance geochemical exploration and airborne geophysical surveys are in progress and exploration crews are currently in the field.
Millrock said the first "designated project" proposed to Vale was accepted, and recently announced as a stand-alone project named AUDN earlier this month. Surface surveys will be carried out in July and August under a separate budget of US$830,000, the company added.
The property is located roughly 100 kilometres to the southeast of the Pebble deposit, a large porphyry copper-gold deposit being advanced by Anglo American plc (LON:AAL) and Northern Dynasty Minerals Ltd (TSE:NDM).
Millrock also holds the Estelle project in Alaska in joint venture with Teck (NYSE:TCK), where a US$1.8 million drilling program is set to start in July, and the Humble project with Kinross Gold (TSE:K), where a follow-up drill program is contemplated for later this year.
At the Council project in Seward Peninsula, Alaska, Millrock and partner Kinross plan to drill six shallow holes to test surface gold geochemical anomalies and gold-bearing veins. The project is budgeted at $1 million and is expected to start next month.
Meanwhile, in Arizona, surface geochemical and geological surveys are planned to follow up on an airborne survey at the Monsoon project, which is under an earn-in agreement with Inmet Mining (TSE:IMN). Drilling may follow later in 2012 or early 2013, Millrock said.
Also with funding from partner Inmet, Millrock plans to drill four rotary holes to test geochemical  and geological targets on the San Jose and Dry Mountain projects in the Safford Trend of southeast Arizona. Drilling operations are also expected to start in July.

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