Misty sizing up Specogna gold deposit

On British Columbia’s Queen Charlotte Islands, Misty Mountain Gold (MGL-T) is drilling off its Specogna epithermal gold deposit in an attempt to amass sufficient data to calculate minable reserves.

Discovered in 1970, the deposit is central to the 172-sq.-mile Harmony property on Graham Island.

Previous operators spent more than $40 million developing a low-grade, bulk-tonnage deposit minable by open-pit methods. Reserves were estimated at 34.5 million tons grading 0.064 oz. gold per ton at a stripping ratio of 1.7-to-1.

A geological evaluation by Misty Mountain reveals that near-vertical quartz veins are the dominant control for higher gold grades, and the company believes the gold content has been underestimated.

The deposit was previously drilled by vertical holes, which, according to Misty, would have prevented the intersecting of higher-grade veins and angle holes. (These were mostly drilled parallel to the northeast-southwest strike direction of the veins.)

On the premise that higher-grade reserves exist within the deposit, Misty began its own drill program in October 1995, testing an initial 15% portion of the Specogna deposit. The drilling was oriented to the southeast and angled at minus 45; the intention was to cut, at as high an angle as possible, the steeply dipping, northwesterly-trending vein swarms.

By March 1996, Misty had completed 32,352 ft. in 49 drill holes and, in doing so, boosted the grade of the area by 24%.

Misty Mountain is now drilling off the entire deposit in a 20-by-20-metre grid pattern. The program is expected to continue until the first quarter of 1997.

Results were recently reported for a further 14 holes, up to hole 96-84.

Significant intercepts include: 98.4 ft. of 0.5 oz. and 118.1 ft. of 0.21 oz.

in hole 96-74; 111 ft. of 0.12 oz. in 96-75; 288 ft. of 0.12 oz. in 96-76; 419 ft. of 0.13 oz. (including 124 ft. of 0.25 oz.) in 96-77; 217 ft. of 0.1 oz. (including 74.6 ft. of 0.14 oz. in 96-79); and 132 ft. of 0.11 oz. and 45.9 ft. of 0.2 oz. in 96-84.

Development of the deposit has been delayed by environmental concerns over potential acid rock drainage and low metallurgical recoveries from the low-grade ore.

The previous operator assumed the deposit was best developed as a large, low-grade, open-pit mine, and Misty says this assumption led to metallurgical and environmental difficulties.

While recoveries of low-grade, disseminated gold mineralization were below 80%, preliminary testwork on the higher-grade vein-type ore indicates gold recoveries in range of 90% are achievable.

Misty Mountain intends to develop Specogna by using mining methods that are applicable to epithermal gold production.

Misty Mountain is one of the Hunter and Dickinson group of companies.