Cathedral finds new zone

After some advanced gold projects held by Imperial Metals were spun out into a new company called Cathedral Gold Corp., the new company promised to begin work on some major programs.

Nearly three months later, Toronto-listed Cathedral Gold has begun to deliver on that promise. According to President Pierre Lebel, surface exploration drilling at Cathedral’s 52%-owned Sterling mine near Beatty, Nev. has uncovered a new ore zone with open pit potential.

Called the Burro North zone, the new discovery was defined by a series of 31 holes drilled on 25-ft spacings along three parallel fences 75 ft apart.

According to Cathedral, eight holes carried some of the following ore grade mineralization: Hole 69 cut a 25 ft intersection grading 0.582 oz gold per ton. Hole 72 intersected a 30 ft cut averaging 0.208 oz. Hole 81 cut 20 ft of 0.257 oz and hole 102 assayed 20 ft of 0.239 oz.

In addition, Cathedral says new drilling targets have been identified in four drill areas near the existing open pit and underground workings.

“A second drill rig will be moved onto the property to test for ore in these new areas,” said Lebel.

Cathedral’s Sterling mine, which began production in 1980, is now producing from both open pit and underground operations at the rate of 12,000 oz annually. Heap Leach

According to Lebel, 270,000 tons of ore have been mined yielding 51,570 oz for an average recovery (using batch heap leach methods) of almost 0.2 oz.

The joint venture partners including Saga Resources (38%) and Geomex Partnership No. 10 (10%), plan to expand the mine’s 200 tpd production rate and drilling will soon be under way to determine the best location for a second decline.

According to the company, this will allow the number of underground working faces to be increased.

At current production levels, the Sterling mine generates annual cash flow of 22 cents per share and earnings of 15 cents fully diluted to Cathedral.

In other news, a 5,000-ft drill program has started at the company’s 100%-owned Cunningham Creek property in the Cariboo Mining District near Barkerville, B.C.

After establishing 36,500 tons grading 0.36 oz gold and 0.48 oz silver above the 200-ft level, Lebel said three holes have been completed, one on the Shasta vein and two on the 605 vein.

“The 605 vein is continuous to a depth of at least 600 ft and the adjacent 605 vein has returned drill results of up to 7.5 ft of 0.80 oz gold,” said Lebel. Cariboo Hudson

Future drill targets include the Cariboo Hudson vein, which has been partly mined, the Replacement zone and the Piers Creek northwest extensions.

An 8,000 ft drill program starts this week at Cathedral’s 100%- owned Porcher Island property 40 miles southwest of Prince Rupert, B.C. where reserves of 249,300 tons grading 0.26 oz gold have been defined.

The program is designed to expand those reserves which are contained within quartz vein structures and test the property’s potential as a bulk tonnage producer, the company reports.

Recently, Cathedral has added substantially to its land position in this area.