NEVADA SPECIAL — Inter-Rock to become Nevada producer

Inter-Rock Gold (IRO-T) expects to join the ranks of gold producers by the end of the year, when its 65%-owned Daisy Gold project, near Beatty, in southern Nevada, goes on stream.

Although not large in comparison to other Nevada mines, Daisy is expected to churn out a respectable 30,000 oz. of the yellow metal annually for at least six years.

Of this total, 19,500 oz. will belong to Inter-Rock, while the remainder will be credited to operating partner Rayrock Yellowknife Resources (RAY-T), which holds 35% of Daisy. Rayrock President David Crombie also heads Inter-Rock, and is the junior’s largest shareholder.

After royalties, refining and tax are factored in, the cash operating costs of the operation jump slightly to US$271 from US$258 per oz.

The project covers 13.7 sq. miles of favorable geology, on which five gold deposits have been defined. Minable oxide reserves at the Secret Pass and West Zone deposits total 11.9 million tons grading 0.018 oz. gold per ton, for 217,000 oz. gold.

The Daisy property has an overall geologic resource of 50.5 million tons grading 0.026 oz. gold, or 1.3 million contained ounces (which includes the above-mentioned reserves, as well as sulphide resources and oxide resources in other zones).

The property also has potential for new discoveries, and exploration there last year discovered a new zone (called the Joshua) of low-grade, near-surface gold mineralization. Further drilling of this and other exploration targets is planned for this year.

Startup costs for the first-stage, heap-leach operation are estimated at US$6.7 million. Inter-Rock’s share will be US$4.4 million.

Daisy’s mine life could be extended further if the application of bio-oxidation to sulphide resources is proved effective. This second phase of development is planned to start in two years, assuming that ongoing test work confirms the gold can be commercially recovered by bacterial oxidation and heap leaching.