St Andrew finds more gold at Taylor — Stepout drill results confirm project’s potential

Junior St Andrew Goldfields (SAS-T) continues to intersect mineralization at its Taylor gold property near Matheson, Ont.

Six holes drilled in the Upper West Porphyry zone returned at least one gold-bearing interval. The gold values reported varied from 1.38 to 48 grams gold per tonne over core lengths of 1.1-6 metres.

Highlights include:

* hole 207, which intersected 6 metres (from 31.8 to 37.8 metres) averaging 5.8 grams, including two sub-intervals of 1.5 metres grading 13.3 grams and 7.3 grams;

* hole 204, which hit three separate intervals of 3 metres (115-118 metres) grading 48 grams, 1 metre (128-129 metres) of 5.6 grams, and 2.9 metres (153.1-156 metres) of 2.6 grams; and

* hole 215, which returned four separate intervals, the best and shallowest of which was 4.3 metres (73.5-77.8 metres) grading 12.8 grams.

To the south, two infill holes were drilled in the contiguous Main West Porphyry zone, and these represent the final holes to be drilled from surface in that zone. By year-end, St Andrew intends to begin driving a decline into the zone from an old exploration shaft, the objective being to prove up resources of 2.1 million tonnes averaging 7.54 grams per tonne. The in-house calculation is based on a cutoff grade of 1.71 grams gold and a cutting factor of 34.29 grams gold.

Results from the infill holes included: 1.3 metres (168.7-170 metres) grading 4.45 grams and 2.2 metres (322-324.2 metres) of 10.8 grams in hole 221; and four separate zones in hole 222, with the widest and deepest of these being 2.5 metres (301.4-303.9 metres) of 107.89 grams. The high-grade interval in hole 221 and the one reported for 222 represent the updip extension of the zone’s hangingwall unit.

Results from stepout drilling are proving to be encouraging. To the west, hole 216 returned two separate intervals of 1.5 metres (259.5-261 metres) grading 44.2 grams and 4.5 metres (435.5-440 metres) grading 4.1 grams, including 1 metre of 11.3 grams. The hole was collared 100 metres from a 3.2-metre interval in stepout hole 115, which averaged 26.06 grams gold.

Three holes drilled east of the Main zone confirmed a fault-offset, mineralized extension to that structure. Like the Upper zone, the Eastern Extension is immediately north of the Taylor fault.

Results included:

* 2.7 metres (295.4-298.1) of 2.8 grams gold in hole 212;

* 1.4 metres (312.7-314.1 metres) of 3.7 grams gold in hole 220; and * 1.5 metres (33-34.5 metres) of 2.4 grams gold, including five deeper intervals of similar lengths and grades, in hole 219.

Nine holes have tested the Eastern Extension since it was discovered last July. As mineralization in this area is closer to the surface and shaft than in the Main zone, the company believes it may play an important role in the project’s development.

Quarterly loss

During the 3-month period ended June 30, St Andrew lost $90,548 on revenue of $1.77 million, compared with a loss of $696,874 on $1.41 million in the comparable period of 1997. Losses in the first half of 1998 amounted to $354,080, compared with $1.5 million in the year-ago period.

Exploration expenditures for the recent quarter were $2.63 million, bringing total expenditures for the 6-month period to $5.9 million. Funds were allocated to Taylor and several other properties.

St Andrew generates revenue (excluding interest and other income) from custom milling ore at its Stock property, situated several kilometres west of Taylor. A 3-year contract, initiated last year, with Exall Resources (EXL-T) and Glimmer Resources (GME-V) allows St Andrew to treat ore mined from the Glimmer mine. Situated near Matheson, the mine is owned 65.5% by Exall and 34.5% by Glimmer Resources.

During the recent quarter, St Andrew also processed 938 tonnes of its own stockpile and a test batch of ore provided by Battle Mountain Gold (BMC-T). It plans to sell, at a later date, the gold recovered from its own material.

The Stock mill has the capacity to treat 1,000 tonnes per day but soon will be expanded to 1,200 tonnes. The added capacity is expected to reduce unit milling costs by 10%.