Solitario Exploration reports final encouraging drill results at Mt. Hamilton, additional drilling planned

Solitario Exploration & Royalty Corp. (AMEX:XPL) (TSE:SLR) announced Thursday the remaining results from its first quarter core drilling program at its Mt. Hamilton gold project in Nevada, returning "outstanding" intersections, and prompting further drilling.
Denver, Colorado-based Solitario has the option to earn up to an 80% interest in the Mt. Hamilton joint venture, a partnership between Solitario and Ely Gold & Minerals (CVE:ELY) signed last year, by completing a feasibility study, making property and royalty payments, and arranging project financing.

Currently, Ely has a 90% initial interest in the joint venture, with Solitario holding the remaining 10%.

The Mt. Hamilton gold project is located at the southern end of the prolific Battle Mountain gold trend in Nevada, and has placed Solitario on the path to becoming a US gold producer.

In a recent interview with Proactiveinvestors, company president and CEO Chris Herald dubbed the property a "real stand-out", praising it for already being at feasibility stage and amenable to heap leach gold mining, with good gold recoveries. The project is also located in one of the best jurisidictions for mining, according to Herald, and has significant potential to be expanded, giving Solitario shareholders massive upside, especially as they stand to gain a controlling interest in the venture.

Highlights of the most recent drill results include holes MH10-09 and MH11-02 on the eastern perimeter of the resource, containing 81.2 metres of 1.93 grams per tonne (g/t) gold equivalent, and 60.9 metres of 1.66 g/t gold equivalent, respectively.

In addition, infill hole MH11-01, which was drilled in an area of sparse exploration, reported 102.5 metres of 1.13 g/t gold equivalent.

“The results of the last three holes confirm our belief that the higher grade portion of the deposit remains open to the east with increasingly strong mineralization," said Herald.

The results formed part of an 11-hole core drilling program, designed to provide feasibility-level information about the resource at Mt Hamilton's Centennial gold deposit.

A study assessing the feasibility of production at Centennial, which will include the latest results, is targeted by the end of the third quarter, Solitario said.

"This potential to expand resources at the Centennial Deposit is enhanced by significant geochemical data supporting other drill targets at Mt. Hamilton in the immediate area of the planned open pitable deposit,” added Herald.

Indeed, the company is planning on testing these other surrounding drill targets shortly, with plans well advanced to begin additional drilling at the project in the third quarter. Twelve holes are planned to test the eastern extension of mineralization and to infill a couple of areas within the Centennial deposit, the company said.

Another 20 holes are also planned in the Chester prospect area, where limited past drilling intersected strong near-surface gold mineralization, according to Solitario. Herald added that he is confident that the company has already increased resouces through recent drilling, and can add to them even further through the discovery of other deposits.

Currently, the Mt. Hamilton project has an NI 43-101 compliant measured and indicated resource of 12.6 million tons at 0.031 oz/ton gold, for 385,350 ounces, and 0.144 oz/ton silver for 1.8 million ounces.

In addition to the potential for more resources, the company recently bought-down a royalty obligation on the property on gold and silver production for $2.5 million. Herald said that this deal is expected to boost the already stellar economics of the project and reduce cash costs by at least $30 per ounce, or by $30 million if resources are doubled, as anticipated.

Solitario is definitely working hard to achieve this goal, having recently optioned the Shell gold-molybdenum properties in the first quarter, located immediately adjacent to Mt. Hamilton. At the Shell leases, historical drilling outlined a strong underground resource, which has the potential to add between 100,000 and 200,000 ounces of gold to the Mt. Hamilton project.

Aside from Mt. Hamilton, Solitario's core business plan is built around the creation of Net Profit Interests in mining projects, based in Latin America, that are operated and financed by leading global mining companies such as Votorantim Metais, Buenaventura (NYSE:BVN), Newmont Mining (NYSE:NEM) and Anglo Platinum (PINK:AGPPY).

The company has developed a pipeline of world class projects that have been ventured to these companies, who fund the development of a bankable feasibility study and assume the risk of mine financing and development at no cost to Solitario.