A BREAKNECK PACE JOHNNY MOUNTAIN

Measured reserves of fewer than 130,000 tons might seem a touch on the light side for anyone to start talking about a mine. But Skyline Resources is more than just talking about that reserve figure forming the centrepiece of its Johnny Mountain (Reg property) operation. It’s going to start mining the stuff this year. At this property, the grade is everything. Preliminary reserves stand at 121,330 tons grading a rich 1.25 oz gold per ton and 2.1 oz silver. Drill- indicated reserves of 161,910 tons grade 0.75 oz gold per ton and 0.97 oz silver. The total measured, indicated, and inferred reserves are 998,700 tons grading 0.721 oz gold per ton. However, Skyline President Reginald Davis says that with exploration last summer, proven and drill-indicated reserves have climbed. The company has also found that the copper content of the reserves is significant.

Lending credence to the whole operation is the mere presence of Skyline’s chairman, Norman Anderson. Anderson was the former chairman of Cominco. Early last year, he was quoted as saying the company envisioned a 200-ton-per-day operation and annual production in the range of 60,000 to 90,000 oz of gold. The company can boost production to 400 tons per day for an expenditure of less than $1 million.

Skyline plans to spend at least $1 million on exploration per year. The company feels that the potential for further finds at the current minesite and in the neighboring area is quite good.

By late last year, the company had reported that mill construction was well under way, the recreation and cookhouse buildings had been completed, and nearly all the bunkhouse trailers were in place. Ore was being stockpiled underground awaiting the arrival and start-up of the mill. The mine and mill will be operating by the first quarter of this year.

This property is not one that can boast proximity to major roadways or much else in the way of infrastructure. Helicopters and fixed-wing aircraft fly in from Wrangell, Alaska, which is about 40 miles away, or from Terrace, B.C., about 175 miles southwest of the property. Johnny Mountain Notebook Location: ……. northwestern British Columbia Major owner: ……. Skyline Explorations Commodities: ……. gold, silver, copper Discovery date: ……. 1980 Production decision: ……. July, 1987 Start-up: ……. first quarter 1988 Capital cost: ……. about $20 million Operating costs: ……. $194 per ton Reserves: ……. measured, inferred, and drill-indicated: 998,700 tons grading 0.721 oz gold per ton Means of access: ……. (initially) two adits at 3,526-ft and 3,690-ft

elevation Extent of vertical workings: ……. Ranges from 3,526-ft elevation at lowest drift level to a 4,018-ft elevation at raise surface collar for current production stope Production rate: ……. start-up at 200 tons per day; planning increase to 400 tons per day Milling plans: ……. on-site Major contractors: ……. Orocon Inc. Status: …….pre-production with one stope currently in production