Tower Hill keeps hitting gold at Livengood

Vancouver – The Livengood gold deposit in Alaska just keeps growing for International Tower Hill Mines (ITH-V).

In the second half of its winter drill program at Livengood Tower Hill focused on probing the potential of the southwest zone, which was the least-tested part of the main deposit. A few early holes into the SW zone returned promising high-grade intercepts, prompting further work.

That work has now been rewarded. Hole 120, the most southwest hole drilled to date, returned 2.11 grams gold per tonne over 45.7 metres, starting 268 metres downhole. And it was a significant step out: the hole was collared 600 metres south and 400 metres west of the nearest hole.

Other drill holes punched into the southwest zone also returned strong results. Hole 130 hit 96 metres averaging 1.1 grams gold from 186 metres depth; hole 119 cut 9.2 metres of 8.33 grams gold from 12 metres depth followed by 57.9 metres grading 2.18 grams gold from 60 metres downhole. Hole 123 hit numerous intersections between 33 and 333 metres depth, the longest of which was 160 metres grading 1 gram gold. Similarly, hole 124 returned several intercepts between 9 and 288 metres depth, including 3.68 grams gold over 7.6 metres and 0.72 gram gold over 80.8 metres.

The zone’s thick intervals grading better than 1 gram gold, and in places better than 2 grams gold, are similar to those in the deposit’s high-grade Core zone, which sits 500 metres to the east. But the mineralization also differs in some significant ways: the Southwest zone shows more veining while the Core zone carries more arsenic and antimony.

At this point, Tower Hill geologists are starting to think the Southwest zone is at least part of a generalized northeast trend of mineralization that extends over a kilometre. Whether the Core and Southwest zones are directly connected remains to be seen, in part because the winter program used all reverse circulation drills.

“We’re definitely keen to get in there and pop some core holes get more information about directionality,” says Jeff Pontius, Tower Hill’s president and CEO. “It could be that we’re actually moving into a different part of the system in the southwest. Then again, if you look at some of our infill holes – hole 110 is basically halfway between the high grades in the Southwest and in the Core and it gave one of our better results. So the answer is we don’t know yet.”

Tower Hill also wanted to probe the deposit’s northeast expansion potential and holes in that area also hit gold. Hole 128, for example, cut five mineralized intercepts between 17 and 277 metres depth including 2.6 grams gold over 6.1 metres and 0.74 grams gold over 41 metres. Hole 130, also in the Northeast zone, returned 0.65 grams gold over 39.6 metres from surface, followed by 1.1 grams gold over 96 metres from 186 metres depth.

And the latest set of results also included some infill drilling. Hole 126, an infill hole on the west side of the Core zone, returned five mineralized intercepts including 35 metres of 0.82 gram gold, 54.9 metres of 1.34 grams gold, and 39.6 metres of 2.37 grams gold.

“The good thing from our standpoint is we haven’t limited the orebody in any way,” said Pontius. “It looks like we still have lots of room to expand to the southwest. And the main soil anomaly, which is how we originally found this thing, still extends to the northeast.”

Tower Hill completed its 10,000-metre winter drill program in mid-April and is now focusing on preparing an updated resource estimate. In a news release Pontius said he expects to see resources increase by 25%. The company plans to release the new estimate in June, which is also when the summer drill program will kick off.

Tower Hill plans to drill 35,000 metres between June and October, which will boost the total metres drilled at Livengood by 70%. While the summer program is underway the company plans to use the June resource estimate to develop a preliminary economic assessment of Livengood and hopes to have it completed by the third quarter.

To assist in that preliminary economic assessment Tower Hill has also been advancing metallurgical studies. The company recently announced that a combination of grinding, gravity concentration, and cyanide leaching of the tails to increase average recoveries by 15% in the oxide and transition rock and by 30% in the un-oxidized rock gave a globa average gold recovery of 89%. That data indicates Livengood’s economics could be helped considerably by using a high recovery milling operation for the high grade ore and a heap leach operation for the low grade ore, which is the practice at the Fort Knox gold mine 60 miles to the south.

In late January Tower Hill announced a resource estimate for Livengood, following its 2008 grid drilling resource definition campaign. The indicated resource currently stands at 128.6 million tonnes grading 0.83 gram gold; inferred resources add 142.1 million tonnes grading 0.74 gram gold. On its own, the higher-grade Core area hosts 68.8 million indicated tonnes grading 1.03 grams gold plus 65.2 million inferred tonnes grading 0.93 gram gold.

The thick, shallowly-dipping gold deposit at Livengood outcrops at one end and looks amenable to open-pit mining. Livengood is favourably located, sitting 110 road km north of Fairbanks along the paved Elliot Highway and the Trans-Alaska pipeline corridor. It is also 55 km north of the Alaska state power grid, along the proposed Alaskan natural gas pipeline route. Tower Hill owns the 44-sq. km Livengood land package completely.

Tower Hill’s share prices gained 14¢ on news of the latest drill results, closing at $3.08. The company has a 52-week trading range of $1.07 to $3.30 and has 49 million shares outstanding.