Trend a friend for Cortez area players

The Cortez area is undergoing a flurry of exploration and drilling activity spurred by drilling successes at the Cortez Hills joint venture.

The Cortez joint venture, held 60% by by Placer Dome (PDG-T) and 40% by Rio Tinto (RTP-N), has the key property in the area. Placer Dome has been mining and exploring this large property since 1964.

The Cortez mine lies along the Battle Mountain trend in north-central Nevada, 60 miles southwest of Elko. Placer recently acknowledged market rumours of a discovery at Cortez Hills in the range of 1.5 oz. gold over more than 400 ft. but tried to tone down its enthusiasm. The company said the results are preliminary and that more work is needed before it can judge the impact of the grades on resource figures.

So far, 44 of a planned 100-200 holes have been drilled at the Cortez Hills area, some of which are testing the area between the Pediment and Cortez Hills discoveries (reported in 1998 and 2002, respectively).

Gold reserves at the Cortez joint-venture properties include 5.2 million oz. at Cortez Hills contained in 41.2 million tons grading 0.127 oz. gold per ton. There are also 3.9 million tons grading 0.138 oz., or 544,000 oz. gold, in the measured and indicated resource categories, and another 8.1 million tons at 0.125 oz., or 1 million oz., in the inferred category.

— White Knight — White Knight Resources (WKR-V) has 11 properties along the Cortez trend. The Indian Ranch property, 10 miles southeast of the Cortez mine, is under option to Placer Dome, which intends to drill 10,000 ft. there this year. Drilling is also planned for the company’s Slaven Canyon property, which is on the same trend as Pipeline.

The company’s properties include Fye Canyon, Pat Canyon and McCluskey, where magnetotelluric and gravity surveys are planned.

— Miranda’s properties — Miranda Gold (MAD-V) has been exploring in the Cortez trend, where it acquired eight properties. Six of these adjoin claims that fall under the Cortez joint-venture agreement. The Miranda ground package reflects the local tectonic environment, where “windows” in the overburden expose older Cortez trend rocks below.

The Cortez mine sits in the Gold Acres window, and the Cortez window hosts Cortez Hills. Miranda has properties that cover the next three windows south of the Gold Acres and Cortez windows: the company’s Red Hills property covers a portion of the JD window, its Coal Canyon property overlies the Windmill window, and at Red Canyon, favourable lower plate rocks are exposed in the Red Canyon window.

— Trend project — Last year, NDT Ventures (NDE-V) acquired the Trend project, which adjoins Placer’s Cortez joint-venture claims to the south. These claims lie 6 miles southeast of the Cortez Hills discovery and are on the same structural trend that hosts the Cortez deposits.

NDT optioned the property to Sudbury Contact Mines (SUD-T) through Sudbury Contact’s unit, Nevada Contact. Nevada Contact can acquire up to a 65% stake in the Trend project — by first earning 51% over four years in return for US$350,000 in cash, US$1.5 million in expenditures, and 210,000 shares; then by completing a feasibility study for the remaining 14%.

— Coral Gold — Coral Gold (CLH-V) owns four properties covering 11,000 acres in the southern Crescent Valley, which adjoins the northern boundary of Placer Dome’s Pipeline mine project. The property hosts 15 areas of gold mineralization, including the 39A zone, the Porphyry zone, the Gold Quartz zone, the Widows mine, Attenburg Hill, and the Gold Pan zone.

A 10-hole program of reverse-circulation (RC) drilling in May 2004 attempted to expand the known mineral resources in the 39A and Gold Pan zones. Hole 8, drilled as a stepout hole on the eastern side of the 39A zone, intersected 80 ft. grading 0.111 oz. gold from a depth of 630 ft., including 30 ft. grading 0.229 oz. gold.

The 39A zone contains a resource of 4.7 million tons grading 0.077 oz. gold per ton.

— Fire Creek — Klondex Mines‘ (KDX-V) Fire Creek claims are 16 miles northwest of Placer Dome’s Pipeline deposit, on the eastern side of the Shoshone Range in Lander Cty.

The company recently completed 8,900 ft. of RC drilling and 7,600 ft. of core drilling in 16 holes, which began in March. Eleven of these holes tested the Main zone, three tested the South target, and two tested the North target.

Highlights include a 10-ft. intersection of 0.87 oz. gold and 0.63 oz. silver drilled in the Main zone at a depth of 970 ft. This carried a 5-ft. interval grading 1.34 oz. gold and 0.9 oz. silver per ton.

Hole 4-02, also drilled at the Main zone, returned a high of 1.54 oz. gold and 1.43 oz. silver over 5 ft. starting at a depth of 905 ft. At the South target, hole 4-11 returned up to 0.41 oz. gold and 0.19 oz. silver over 10 ft. starting at a 720 ft. down-hole.

The property has a resource of 19.7 million tons containing 600,000 oz. gold.

— Tonkin Springs — BacTech Mining (BM-V) has a 55% interest in the Tonkin Springs gold project, with the remainder held by U.S. Gold (USGL-O). BacTech’s property covers a 12-mile section of the Cortez trend in the vicinity of White Knight’s Fye Canyon, Pat Canyon and Indian Ranch properties.

With a positive feasibility study in hand, the companies are planning a 5-year, 100,000-oz.-per-year operation with average cash costs estimated at US$238 per oz. Bactech plans to apply its patented bioleaching technology to recover gold from Tonkin Springs.

The property contains minable reserves of 10.6 million tons grading 0.061 oz. gold, or 646,000 oz.

Measured and indicated resources total 29.6 million tons grading 0.043 oz. gold per ton (1.27 million oz.) at a 0.012-oz.-per-ton cutoff. Inferred resources amount to 3.4 million tons grading 0.044 oz. gold (152,000 oz.).

Infill drilling is under way at existing pits, and surface work and subsequent drilling for potential near-surface deposits are planned. Five targets have been identified in the southern half of the property, and soil and chip sampling are planned. Some work is also planned for the northern section of the property.

— Nevada Pacific — In the Cortez trend, Nevada Pacific (NPG-V) has the Keystone property and the Pat Canyon mineral lease, which adjoin the Tonkin Springs project. Keystone is 12 miles south of the Cortez Hills discovery and was recently expanded to cover 11 square miles south of the Cortez joint-venture property on the northwestern flank of the Simpson Park Mountains.

Keystone is underlain by limestone, shale, and sandstone, which have been intruded by a granodiorite stock. Base and precious metals mineralization occurs in skarn zones near the northern edge of the intrusive. The Keystone mine exploited stratabound base and precious metals mineralization in the 1940s and 1960s, with 114 tons of ore yielding 19,800 lbs. lead, 17,900 lbs. zinc, 1,400 lbs. copper, and 417 oz. silver.

This spring an induced-polarization survey covering a 5,000-by-3,280-ft. area was centred on the old Keystone base metal workings, targeting massive-sulphide replacement bodies along the intrusive contact. Four discrete anomalies were found, one of which coincides with high-grade massive sulphide float on surface.

About 5,000 ft. of RC drilling and 3,000 ft. of core drilling are planned for the property once access roads and drill sites are completed.

— Mill Creek — X-Cal Resources‘ (XCL-V) Mill Creek property is 13 miles northwest of the Gold Acres-Pipeline Mine complex, in the Goat Window of the Cortez trend.

Drilling has been under way since April. Two holes were completed as part of the 13,000-ft. program, and a gravity survey is providing further targets.

— Golden trend — J-Pacific Gold‘s (JPN-V) properties in the Cortez trend include the Golden Trend property, which adjoins Placer’s ET Blue project, and the HC project, along the Buckhorn mine
trend.

Japanese gold-investment company Jipangu recently acquired a 50% option on J-Pacific’s properties. Drilling is planned for Golden Trend; soil sampling, for HC.

— Montezuma — CMQ Resources‘ (CMQ-V) Montezuma property comprises 7,960 acres in the Crescent Valley in Eureka Cty., 53 miles southwest of Elko.

Exploration includes geologic mapping, soil and rock geochemistry, magnetic and gravity geophysical surveys, and two rotary drill holes. The surveys indicate that this part of the valley is a saddle-shaped basin with a northwest-trending bedrock horst forming a bridge between deeper parts of the basin to the west and east. This horst block is prospective for Cortez and Pipeline-type deposits.