Loki reports reserves for Brewery Creek project

Results from an initial reserve study on the Brewery Creek project were released by Loki Gold (VSE), a juniopr holding an option to earn a 40% working interest in the Yukon gold project from a unit of Noranda (TSE).

Based on the report delivered to Loki by project operator Noranda, preliminary reserves at Beaver Creek total 11.1 million tons grading 0.052 oz. gold per ton. These reserves are divided into three types; limonitc porphyry intrusive (oxide), fresh porphyric intrusive and argillite hosted.

Geologists from Noranda’s Whitehorse office are credited with the initial discovery at Brewery Creek, the Moosehead zone, while testing a large soil geochemical anomaly on the property in 1987. Ongoing work led to the discovery of a number of other zones. The overall Brewery Creek deposit is still open, and will require infill drilling to establish mineral reserves.

The oxide porphyry reserves form the most significant component of preliminary reserves, and total 8.2 million tons gradin 0.055 oz. gold. Reserves within this category have been identified within eight of the nine zones on the property. The Canadian, Kokanee and Golden North host the bulk of current oxide reserves.

These zones (names after different beer brands, in keeping with the brewery theme) are hosted by a south-dipping felsic intrusive sill which is intermittenly exposed on south-facing hills over a strike legnth of 9.6 miles. All mineralized zones delineated to date occur within 96.5 ft. of surface and are considered amenable to open pit mining.

Metallurgical test work is considered preliminary, but work completed to date is reported to have indicated “excellent” characteristics for either heap leach or conventional mining.

The reserve numbers for the Brewery Creek project are based on the results of 25 diamond drill holes, 323 reverse cirulation drill holes, and 45 trenches. A cutoff grade of 0.015 oz. gold per ton was used to calculate reserves.

Ron Netolitzky, a director of Loki, said the company will be meeting with Noranda to discuss plans for the property in the coming season. Loki hopes to release details of the 19901 program within the nexxt several weeks.

The Brewery Creek property, accessible by road, is 35.4 miles east of Dawson City and covers 17,148 acres.