Chapleau, White Knight test properties

Partners Chapleau Resources (CHI-V) and White Knight Resources (WKR-V) have resumed drilling on their Squaw Creek gold property in Nevada.

The property lies on the northern end of the Carlin trend, between the Midas and Ivanhoe mining districts. Chapleau can earn a half-interest from White Knight by spending US$1.5 million on exploration and paying US$500,000 over four years.

In April, the partners expanded the property’s southern boundary by optioning a further 65 claims, known as the Sheep Corral property. Under terms of that agreement, Chapleau is required to fund exploration costs of up to US$300,000 over three years, with subsequent costs shared equally with White Knight.

Previous drilling by Newmont Mining in the Sheep Corral mine area encountered 115 ft. grading 0.027 oz. gold per ton and 295 ft. grading 0.018 oz. gold.

Chapleau and White Knight believe the Squaw Creek and Sheep Corral properties are prospective for two styles of gold mineralization: a high-grade volcanic-hosted style occurring at the contact between the volcanics and the Valmy Formation sedimentary rocks, and a deeper sediment-hosted style in the Popovich or Roberts Mountain Formation.

During the summer of 1998, the partners completed three holes encountering weakly anomalous values of mercury, arsenic and gold in Tertiary volcanic cover rocks. This year’s drilling program, consisting of 10,000 ft. in six holes, will focus on the Sheep Corral fault zone.

Meanwhile, White Knight and Chapleau have resumed drilling at the Indian Ranch property in the heart of the Cortez gold trend. The property consists of a single block of 607 claims covering 12,140 acres, situated 38 miles northwest of Eureka. Chapleau can earn a half-interest in consideration of spending US$1.5 million in exploration and paying a total of US$500,000.

Previous drilling indicates that a window of Lower Plate Paleozoic carbonate sediments of the Roberts Mountains or Hanson Creek Formation underlies the volcanic and alluvial cover on much of the central and eastern portions of the Indian Ranch property. This covered window is present in the form of several uplifted or horsted blocks.

Elevated gold and associated hydrothermal alteration occur across the property in both Upper and Lower Plate rocks. The partners are using geophysical gravity surveys to define fault margins on the uplifted blocks, as well as what are believed to be potential ore-controlling structures within the blocks. An initial four holes totalling 6,000 ft. will test some of these structural targets.