SpectrumGold looks to Galore Creek

Vancouver — The first four holes of a recently completed 3,000-metre drill program on the historic Galore Creek copper gold property in northwestern British Columbia have given a boost to newly minted SpectrumGold (SGX-T).

The best values from the initial batch occurred in hole 437, which returned 164.4 metres grading 1.16% copper and 1.52 grams gold. Hole 436 yielded 148.9 metres of 0.7% copper and 1.86 grams gold, whereas holes 438 and 439 returned 74 metres of 0.89% copper and 0.37 gram gold and 114.6 metres of 1.17% copper and 1.98 grams gold, respectively.

The first-pass program is attempting to identify higher-grade zones that can be traced. In total, four areas of the deposit were tested: the North Gold lens, South Gold lens, the Central Replacement zone, and the Southwest breccia.

The company picked up the project earlier this year by inking a deal with mining giants Rio Tinto (RTP-N) and Anglo American (AAUK-Q). The price tag rings in at US$20.3 million, payable over eight years, with US$300,000 due in the first three years.

Galore Creek is a classic alkalic intrusive-related gold-silver-copper deposit that has been worked since the early 1960s. A 1992 estimate by Kennecott Exploration, a subsidiary of Rio Tinto, pegged the measured and indicated resource at 243.2 million tonnes grading 0.45 gram gold and 6 grams silver per tonne, plus 0.75% copper. The inferred resource was estimated at 70.6 million tonnes grading 0.63 gram gold, 6 grams silver and 0.59% copper. A 1997 provincial government report gave the Central zone an indicated resource of 233.9 million tonnes grading 7 grams silver, 0.35 gram gold and 0.67% copper, based on a cutoff grade of 0.27% copper-equivalent. The Southwest zone has an indicated resource of 42.4 million tonnes grading 7 grams silver, 1.03 grams gold and 0.55% copper, whereas the North Junction zone has 7.7 million tonnes of 1.5% copper in the indicated category, based on a 0.4% copper cutoff.

On the back of the deal, NovaGold Resources (nri-t) bought 2.28 million shares, or 16.3% of SpectrumGold, from Quest Capital (QCCNF-OTC) for $1.7 million in cash.

SpectrumGold, now a 56%-owned subsidiary of NovaGold, began trading on the Toronto Stock Exchange in late October. The junior, with 20.9 million shares outstanding, has a 52-week trading range of $2.14 to $4.25, and recently traded at around $3.60.