Underground drilling results at Nicholas Lake encouraging

Management of Athabaska Gold (TSE) is encouraged by underground drill results from its Nicholas Lake property, 60 miles north of Yellowknife, N.W.T.

Results have been received from 15 of the 36 holes drilled in this year’s program. Some of the better intersections include 6.9 ft. grading 1.92 oz. gold per ton in hole NU-03-94, 7.2 ft. of 1.17 oz. in NU-13-94, 8.7 ft. of 1.59 oz. in NU-14-94, 2.2 ft. of 1.81 oz. and 1.9 ft. of 2.28 oz. in NU-16-94, and 10.4 ft. of 2.26 oz. plus 4.9 ft. of 4.76 oz. in NU-19-94. Much of the previous work at Nicholas Lake dates back to 1988-89, when a probable and possible resource of 1.1 million tons grading 0.38 oz. was outlined.

A prefeasibility study in 1990 estimated that a 350-ton-per-day operation would cost $18 million to start up, and that it would generate annual cash flow of about $8 million.

The current drilling is aimed at upgrading the probable portion of the resource to the proven category so that the company can proceed with a final feasibility study.

Athabaska’s president, James Kermeen, says a reserve in the area of a half-million tons of the same grade would likely warrant production. Assuming the balance of the results from the current program is positive, Kermeen says, the project could conceivably be in production by next October.