Geoinformatics’s share price soars on resource estimate (January 09, 2008)

A new resource estimate on the Whistler gold project in Alaska is a “milestone” for Canadian junior Geoinformatics Resource Exploration (GXL-V), the company says.

Its National Instrument 43-101 resource estimate indicates that the greater Whistler zone, about 160 km northwest of Anchorage, holds an indicated resource of 840,000 oz. gold, 2.37 million oz. silver and 159 million lbs copper. Those numbers yield a gold equivalent resource of 1.31 million oz. gold.

The deposit has an inferred resource containing 2.74 million oz. gold, 9.44 million oz. silver, and 573 million lbs copper or a gold equivalent resource of 4.4 million oz.

The indicated category contains 30 million tonnes grading 0.87 gram gold per tonne, 2.46 grams silver per tonne and 0.24% copper. The inferred category holds 134 million tonnes grading 0.64 gram gold per tonne, 2.18 grams silver per tonne silver and 0.20% copper.

News of the resource estimate sent shares of Geoinformatics on the TSX Venture Exchange shooting up 117.9% to 30.5 apiece on a trading volume of 19.9 million.

“It really allows the market to place a value on the project and ultimately on the underlying shares of the company and it highlights the merits of our alliance with Kennecott,” says Petra Decher, the company’s president and chief financial officer. “It’s a world-class discovery and deposit in North America. It’s a very solid attractive project in a stable, mining-friendly jurisdiction.”

Describing the Whistler zone as “a new porphyry province,” the company also points out that it remains open in several directions and at depth. In addition, there are numerous high-quality exploration targets with similar geophysical signatures that have been identified in close proximity.

Geoinformatics plans to focus on advancing the resource “as quickly and as cost effectively as possible,” Decher says, adding that definition and infill drilling will be conducted this year as well as a scoping and pre-feasibility study.

The resource estimate was based on a conceptual model and optimized open-pit design in which 93% of the total tonnage would be extracted as part of an open-pit operation with a cut-off grade of 0.3 gram gold equivalent per tonne.

The remaining 7%, at a cut-off grade of 1.1 grams gold equivalent per tonne, could potentially be extracted by bulk underground mining methods.

The total indicated and inferred resource includes both the Whistler and Main zones. The Main zone is higher grade and is hosted within the broader envelope of the Whistler zone.

Geoinformatics acquired the Whistler project as a target-of-merit from Kennecott Exploration in June 2007. Kennecott, a subsidiary of Rio Tinto (RTP-N, RIO-L, RIO-A), retains a back-in right to acquire either a 51% or 60% interest in the project.

The 444-sq.-km property sits at the northeastern end of the prospective Southern Alaskan Range, which is also home to the massive Pebble copper-gold-molybdenum-silver deposit to the southwest.

The Whistler property is made up of 732 mining claims on state land that is designated for exploration and development.

The Whistler zone outcrops on a broad, fairly flat ridge with very little vegetation at an elevation of about 800 metres.