Nevada Pacific targets Limousine Butte (May 29, 2003)

Vancouver-based junior Nevada Pacific Gold (NPG-V) is gearing up to drill test the Resurrection Ridge zone on its 40-sq.-km Limousine Butte gold project located in east-central Nevada.

Resurrection Ridge is one of five disseminated oxide gold zones identified at Limousine Butte. Previous drilling on the zone is highlighted by:

• Hole LIM-40 – 45.8 metres (from 27.5 metres below surface) running 1.4 grams gold per tonne;
• Hole LIM-46 – 21.4 metres (from 126.6 m) grading 4.7 grams gold, including 7.6 metres (from 128.1 m) averaging 9.6 grams;
• Hole LIM-48 – 30.5 metres (from 19.8 m) of 01.4 grams gold;
• Hole SKB-128 – 44.2 metres (from 16.8 m) at 1.8 grams gold;
• Hole SKB-151 – 12.2 metres (from 65.6 m) grading 4.7 grams gold, including a 4.6-metre interval (from 71.7 m) of 7.2 grams; and
• Hole SKB-262 – 35 metres (from 88 m) averaging 4.6 grams gold, including 10.7 metres (from 90 m) running 11 grams.

Drilling at Resurrection Ridge indicates that the higher-grade gold mineralization is controlled by northwest and northeast running structural controls, with the best grade found at structural intersections.

The company is currently seeking permits for a 3,000-metres drill program designed to test structural intersections that have returned the best grades laterally and up and down dip.

Nevada Pacific recently regained outright ownership of Limousine Butte by picking up the half-interest it didn’t already own from Newmont Mining (NEM-N). Newmont retains a net smelter return varying between 1.5-2.5% plus a US$1-million advance payment once commercial production begins.

In August 2002, Newmont pegged the project’s mineral inventory at around 35.8 million tonnes running 0.55 grams gold per tonne, or 620,743 contained gold ounces, based on a cutoff grade of 0.2 gram gold.

The inventory includes material from Resurrection Ridge plus the Black Valley, Mustang Hill, Pony Express and Coffee Mug zones.

The property is centred on a large hydrothermal system. Nevada Pacific’s exploration efforts are focussed on finding district-scale disseminated, structurally controlled and skarn hosted gold deposits associated with a large mineralized porphyry complex. Exploration for copper in the 1960s uncovered a deep-seated porphyry system in the southwestern portion of the property.

In the 1980s, a joint venture between Alta Gold and Echo Bay Mines (ECO-T) recovered just under 100,000 oz. gold via a heap-leach operation at the Golden Butte mine, along the northeastern corner of the property.

Meanwhile, up in the Yukon Territories, Nevada Pacific has dropped its plan to buy out of receivership the Keno Hill silver mine, 350 km north of Whitehorse.

The company said its decision was based on “a thorough evaluation of the assets, discussions with the Yukon Territorial Government and other due diligence investigation.”

In return for $3.6 million Nevada Pacific stood to gain the 105-sq.-km property along with surface buildings and a 450-tonne-per-day mill.

In 1996 the property’s measured and indicated resource was estimated at 680,000 tonnes grading 1,033 grams silver per tonne, with 5.08% lead and 4.05% zinc. An inferred resource topped out at 190,000 tonnes running 992 grams silver, 5.92% lead and 7.28% zinc.

Nevada Pacific’s plan was to try and revive the past producer by using new ground support techniques and lower-cost mining methods.