Developing a High-grade Gold and Silver Deposit in Nevada: Interview with Corvus Gold CEO

This interview was conducted as part of Corvus Gold’s advertising campaign in our recent 2014 Commodities forecast eBook. 

In a market saturated with exploration companies, many of which are exploring for gold, it is important to find those companies that stand out in the crowd. Since January, there is little question that one of those companies is Corvus Gold ( TSX:KOR, OTCQX:CORVF).

In recent months, Corvus’ stock price has been on a tear as the company continues to release impressive drill results to the market. To learn more about what makes Corvus’ North Bullfrog project in Nevada significant, Gold Investing News spoke with CEO Jeffrey Pontius.

GIN: Jeffrey, Corvus has released a slew of great results from the Yellowjacket deposit at the North Bullfrog project in Nevada. The last two results, as well as your initial resource of the Yellowjacket deposit for North Bullfrog, came in the first few months of the year. What makes these results so impressive and why are they so significant?

JP: The results are most impressive in the consistency of this initial high-grade discovery in the North Bullfrog District.  This broad near surface, high-grade gold silver system is very similar to the Bullfrog Mine operated in the 1990’s by Barrick Gold about 10 kilometres to the south which was one of the highest margin gold operations in Nevada.  What is of most interest in the January release was hole NB-13-370 which was drilled to a vertical depth of 170 metres and indicates that the system may become broader with higher grades at depth which was also the case at Barrick’s mine to the south.

The results released in early March showed the further upside of the project as we intersected what could be a parallel vein system to the Yellowjacket zone approximately 50 metres to the west.  These recent results show that we have much more room to grow the system along strike and at depth.

GIN:  You have over 35 years experience in the industry, including a number of years spent exploring Nevada that included the discoveries of the Yankee Mine and Elder Creek Mine.  What excites you about Nevada and the North Bullfrog project?

JP: Nevada is blessed with a number of factors:

1) One of the best gold and silver endowments per square mile than almost any other area globally

2) Strong concentration of technical expertise that includes drill operators, engineers and geologists

3) Stable political jurisdiction with over a century of mining as a pillar of the economy

4) Local and regional support and understanding of the mining industry

5) Well developed infrastructure making for low cost exploration and development

and because of these factors I feel that Nevada is a go to jurisdiction for both exploration and producing companies.  That said Nevada has seen over $10B of exploration & development work during the past several decades and so a lot of projects have experienced 2, 3 and 4 periods of exploration over the years creating a mature and challenging exploration environment.  North Bullfrog is different in that it has only seen one significant past exploration event by Barrick in the 1990’s when gold was <$400 per ounce.  The fact that deposits like Corvus’s new Yellowjacket and Barrick’s Bullfrog were covered targets opens up significant new discovery potential in a premier gold region that is underexplored; a truly unique opportunity for Corvus Gold.  We have now drilled about 300 holes in this emerging major new gold-silver discovery and just beginning to unlock the potential on this 100% owned project.  In Nevada, for a junior company to hold a 100% ownership of a project is rare as projects are in high demand so are typically joint ventured.

GIN: North Bullfrog is only 10 kilometers north of the Bullfrog mine which was operated by Barrick. Is the mineralization similar to the Bullfrog mine, from what you’ve unearthed so far?

JP: Both the Bullfrog mine and North Bullfrog project are part of the Walker Lane Gold Belt of Nevada and hosted within the same volcanic rocks.  There are many great deposits throughout the Walker Lane Gold Belt that include Comstock and Round Mountain.  Barrick operated the Bullfrog mine during the 90’s at a time of depressed gold prices.  Regardless, it was a fantastic deposit that produced over 2.5M oz’s in an open pit and underground operation.  The Bullfrog mine was an epithermal deposit with a vein system that was about 5 metres wide with grades of about 10 g/t gold and 10 g/t silver surrounded by a stockwork zone that averaged about 1-2 g/t gold and then disseminated gold at grades less than 1 g/t gold.  What we have been finding recently at North Bullfrog’s Yellowjacket deposit is a system that has a vein that averages about 5 metres with grades of about 10 g/t gold and 50 g/t silver surrounded by a stockwork system that averages 1-2 g/t gold grading out into a disseminated gold zone so very similar but Yellowjacket has higher silver values.  The currently defined dimensions of the systems are very similar although Bullfrog extended to a depth of over 300m which we have yet to test.

GIN:  What are the aims of your current exploration program at Yellowjacket? Are you going to be testing other targets within North Bullfrog as well?

JP: The 2014 drill program will kick off at the end of January.  Our primary goal is to continue drilling at Yellowjacket as we have yet to find the extent of the high-grade mineralization – both along strike and at depth.  We have currently outlined a system that is over 800 metres in length, over widths of 50-150 metres to a vertical depth of about 120 metres.  As mentioned earlier, one of our last reported holes (NB-13-370) from the 2013 drill program was drilled to a vertical depth of 170 metres and it intersected a very high grade vein at that level so expanding the deposit at depth looks very promising.  We have also identified other structures at the project that look very similar to the Yellowjacket and Bullfrog systems and these will be addressed in 2014 as well.

GIN: As you know, this is a tough time to raise financing in junior mining. But in November you managed to raise just over $5 million, including share buys from some heavy hitters like the Tocqueville group, AngloGold Ashanti & Peter Schiff. How were you able to raise the capital?

JP: We are fortunate to have long-term, long-gold shareholders that believe in our ability to create value through new exciting discoveries and the development of those discoveries.  John Hathaway of Tocqueville has been a stalwart supporter of our work and along with our other supportive shareholders has allowed us to continue to do what we do best – deliver top tier discoveries to our shareholders.  We believe that regardless of the market, a new high quality discovery will receive value and thus our strategy is to continue to pursue those discoveries to maximize value to our shareholders.  This strategy has perked the attention of new shareholders such as Peter Schiff who we all know is a strong believer in gold.

GIN: Your stock price, especially over the last 6 months, has held up really well in a field that has seen a lot of carnage for most junior gold companies. Why do you think the market has responded so well to your company and the news you’ve put out?

JP: A number of factors have helped us recover in the latter part of 2013.  First and foremost are our results.  A high-grade top tier discovery will always command the attention of investors and having that discovery in jurisdiction like Nevada will draw an even greater audience.  We have a dedicated, small, efficient team that works well together and combined with an optimal share structure – with long term holders, no warrants and low float gives us the ability to get the maximum effect from our results and an improving gold market.

GIN: Corvus announced a new resource estimate for North Bullfrog on February 25, 2014. At this early stage, how should investors interpret these results?

JP: The resource update for North Bullfrog was predominantly for the Yellowjacket deposit where the Company has focused much of its attention during the 2013 drill program.  At a 0.3 g/t cutoff, there are approximately:

– 1.8M tonnes of 1.7 g/t gold and 9.7 g/t silver for 100k ounces gold and 550k ounces silver indicated resource

– 12.9M tonnes of 1.3 g/t gold and 8.0 g/t silver for 530k ounces gold and 3.3M ounces silver inferred resource

If the cutoff grade is at 1.0 g/t, there are approximately:

– 880k tonnes of 2.8 g/t gold and 16.5 g/t silver for 79k ounces gold and 470k ounces silver indicated resource

– 4.5M tonnes of 2.4 g/t gold and 17.5 g/t silver for 355k ounces gold and 2.54M ounces silver inferred resource

So if the cutoff grade is doubled, and only approximately 20-30% of the ounces are lost shows the high-grade nature of Yellowjacket.  For an open-pit project, grades that we have been establishing at Yellowjacket are very robust – Bullfrog Mine comparable.   It is important to note that Yellowjacket is still open and will receive the bulk of attention in the first phase of drilling in 2014 and there is a possibility that we can continue to grow this deposit to compliment the bulk tonnage lower grade disseminated oxide resource.

GIN: What does Corvus hope to accomplish in 2014?

JP: We look to further our exploration success in 2014 and highlight the extent of this new Nevada discovery.  We believe we are just beginning to unlock to potential of a new, district scale high-grade, gold-silver deposit and 2014 should be an exciting and rewarding year for our shareholders.

GIN: Perfect. Thank you for chatting with us today.

JP: Thank you.

Editorial Disclosure: Corvus Gold is an advertising client of the Investing News Network. This interview was conducted as part of Corvus Gold’s advertising campaign in our recent 2014 Commodities forecast eBook.