Emgold Mining Corporation announces it has signed a Letter of Intent with Nevada Sunrise LLC, a private Nevada company, giving it the right to purchase 12 unpatented mining.
Emgold Mining Corporation (TSXV:EMR; OTC:EGMCF; FWB:EMLN) (“Emgold” or the “Company”) announces it has signed a Letter of Intent with Nevada Sunrise LLC, a private Nevada company, giving it the right to purchase 12 unpatented mining (the “NS Claims”). The Company has also signed a second Letter of Intent with BL Exploration LLC, a second private Nevada company, giving it the right to purchase 18 unpatented mining claims (the “BL Claims”). Together, the 30 unpatented mining NS Claims and BL Claims make up the Mindora Property (the “Property”). Hole No. 7, shown in Table 1 below, contains 105 ft. (32.0 m) of 0.057 opt (1.94 gpt) gold and 3.552 opt (121.78 gpt) silver, representing a 0.098 opt (3.36 gpt) AuEq grade from a hole depth of 0 to 105 ft. (0 to 32.0 m), with true width of the intercept unknown.
About the Mindora Property
The Property is a gold/silver and base metal property located 20 miles southeast of Hawthorne, Nevada. The gold-silver zone is an epithermal, carbonate-hosted, structurally controlled deposit in the Luning Limestone Formation. The gold-silver zone overlies a porphyry system with molybdenum mineralization. There is also evidence of copper skarn and copper porphyry mineralization on the Property.
The Property was discovered and worked in the late 1800’s. In the 1920’s with a limited amount of production came from a series of rich, silver-bearing veins. During the period 1946-1948, an estimated 10,000 tons of direct-shipping ore was mined from the Property at unknown grade.
In the 1970’s, geologists recognized the epithermal nature of mineralization, and similarities to the nearby Santa Fe deposit and other carbonate-rich sediment-hosted gold deposits in Nevada. Several companies staked the property during this period, did limited sampling and geophysics, and then dropped their claims.
Hawthorne Gold Corporation acquired the property in 1979, and in the following year, brought in E & B Exploration Inc. as a joint-venture partner and operator. E & B completed programs of rock-chip sampling and trench sampling, surface and underground mapping, geophysical surveys, and drilled approximately 31,425 ft. (9,578 m) in 134 holes (including a water-well and two diamond core holes). E & B’s work developed four known mineralized zones.
Eureka Resources, Inc. acquired E & B’s interest in 1983. Eureka conducted IP, magnetic and VLF electromagnetic surveys, soil and rock-chip sampling and drilled an additional approximately 11,441 ft. (3,487 m) in 40 holes. In 1988, Eureka commissioned metallurgical studies and a detailed review by Kilborn Engineering with the goal of developing a small open pit gold mine. Total drilling on the Property is therefore about 42,836 ft. (13,056 m), mostly in vertical holes in the range of 200-400 ft. (61-122 m), with a maximum drilling depth of 700 ft. (214 m).
Eureka failed to file assessment work on the claims in 2001 and Nevada Sunrise LLC and BL Exploration staked the Property in 2001 and 2003, resulting in the current land package of the NS and BL Claims, respectively. Little exploration work has been done on the property since the last drilling program, completed in 1995.
From the historic data, Emgold has summarized a list of significant gold and silver intercepts, as shown in Table 1. This table contains drill intercepts with grades greater than 0.01 opt (0.34 g/t) AuEq gold grades and lengths greater than 25 ft. (7.6 m). A gold price of $1,300 per ounce and a silver price of $15 per ounce were used to calculate gold equivalent grades, at a ratio of 86.7, with no allowance for metallurgical recovery. True widths of intercepts are unknown.
Emgold has also summarized a list of significant molybdenum intercepts, as shown in Table 2. This table contains drill intercepts with greater than 0.01% Mo and lengths greater than 25 ft. (7.6 m). Note that many holes bottomed in molybdenum mineralization. The longest intercept was 295 ft. (90 m) of 0.59% Mo from in drill-hole 162. True widths of intercepts are unknown.
There is little assay information on copper mineralization on the Property. A report titled “Assessment Report on the Mindora Property, Mineral County, Nevada for Eureka Resource Inc.” by Myra Schatten, B.C., dated April, 1993, looked at copper mineralization on the Property. The report identified several copper anomalies. It concluded that copper mineralization occurs as skarns along the contact between the intrusives and the limestone and sediments, as replacement zones adjacent to intrusive and limestone sedimentary contacts, and as porphyry mineralization.
The data available on the Property was generated through exploration prior to the implementation of National Instrument NI 43-101. This data is historical in nature and Emgold has not yet completed sufficient work to independently verify these historic results, therefore they should not be relied upon. There is, however, sufficient data available to create a 3-Dimensional model of the historic data to ultimately use as guide future exploration.
Terms of the Nevada Sunrise LLC Transaction
Emgold has agreed to purchase a 100 percent interest in the 12 unpatented mining NS Claims from Nevada Sunrise LLC under the following terms:
US$50,000 on closing;
US$25,000 per year on the anniversary date of the closing for a period of four years.
Total purchase price of US$150,000.
Terms of the BL Exploration LLC Transaction
Emgold has agreed to purchase a 100 percent interest in 18 unpatented mining BL Claims from BL Exploration LLC for US$50,000, due at closing. The BL Claims will be subject to a US$20,000 per year advance royalty. Emgold will assign a 2% NSR royalty to BL Exploration. Emgold will have the option of acquiring one half of the 2% NSR for US$200,000 on or before the fifth anniversary of the closing of the transaction. Should Emgold not exercise this option, it will have a second option of acquiring 1/2 of the 2% NSR for US$500,000 after the fifth anniversary and before the ninth anniversary of the closing of the transaction.
Both the Nevada Sunrise LLC and BL Exploration LLC transactions are subject, amongst other conditions, to completion of a definitive agreement and regulatory approval by the TSX Venture Exchange.
Robert Pease, C.P.G., a qualified person under the NI 43-101 instrument, has reviewed and approved the content of this press release.
Emgold is a junior gold exploration company focused on Nevada and Quebec. The Company’s strategy is to look for asset acquisitions and divestitures, joint ventures, option, royalty, and other business opportunities to advance the Company and create value for our shareholders. Our properties include the Golden Arrow, Buckskin Rawhide East, Buckskin Rawhide West, and Koegel Rawhide Properties in Nevada and an option to acquire up to a 91% interest in the Casa South Property in Quebec, adjacent to Hecla Mining Corporation’s operating Casa Berardi Mine. The Company has a strategic investment of 3.75 million shares of Troilus Gold Corporation (TSX: TLG) which is advancing the Troilus Gold Project in Quebec. For more information on the Company, investors should review the Company’s filings that are available at www.sedar.com or the Company’s website at www.emgold.com.
On behalf of the Board of Directors
David G. Watkinson, P.Eng.
President & CEO
For further information, please contact:
David G. Watkinson, P.Eng.
Tel: 530-271-0679 Ext 101
Neither TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Note on Forward-Looking Statements
This news release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable Canadian and U.S. securities legislation, including the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included herein including, without limitation, statements regarding the anticipated results from exploration activities, the discovery and delineation of mineral deposits/resources/reserves and the anticipated business plans and timing of future activities of the Company, are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: “believe”, “expect”, “anticipate”, “intend”, “estimate”, “postulate” and similar expressions, or are those, which, by their nature, refer to future events.
The Company cautions investors that any forward-looking statements made by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including potential acquisition of the Mindora Property, further exploration, development, or mining activities on the Mindora, Property, or its other Properties, operating and technical difficulties in connection with mineral exploration and development activities, the estimation or realization of mineral reserves and mineral resources, the timing and amount of estimated future production, the costs of production, capital expenditures, the costs and timing of the development of new deposits, requirements for additional capital, future prices of precious metals, changes in general economic conditions, changes in the financial markets and in the demand and market price for commodities, labour disputes and other risks of the mining industry, delays in obtaining governmental approvals, permits or financing or in the completion of development or construction activities, changes in laws, regulations and policies affecting mining operations, title disputes, the inability of the Company to obtain any necessary permits, consents or authorizations required, including TSX Venture Exchange acceptance of any other current or future property acquisitions or financings and other planned activities, the timing and possible outcome of any pending litigation, environmental issues and liabilities, and risks related to joint venture operations, and other risks and uncertainties disclosed in the Company’s latest interim Management’s Discussion and Analysis and filed with certain securities commissions in Canada. The Company’s Canadian public disclosure filings may be accessed via www.sedar.com and readers are urged to review these materials, including the technical reports filed with respect to the Company’s mineral properties.
The Company does not undertake to update any forward-looking information provided in this press release or Management’s Discussion and Analysis, except as, and to the extent required by, applicable securities laws. For more information on the Company and its business, investors should review the Company’s annual information form and other regulatory filings filed with securities commissions or similar authorities in Canada that are available on SEDAR at www.sedar.com. The Company reviews its forward-looking statements on an ongoing basis and updates this information when circumstances require it.
Readers are cautioned not to place undue reliance on forward-looking statements. The Company undertakes no obligation to update any of the forward-looking statements in this news release or incorporated by reference herein, except as otherwise required by law.