Coldstream warms up for Foundation, Alto

VANCOUVER — Foundation Resources (FDN-V) and Alto Ventures (ATV-V) are hitting good gold grades in their second phase of drilling at the historic Coldstream gold project near Thunder Bay, Ont.

An initial winter drill program at Coldstream returned some of the best grades and longest intercepts to date from the project, which hosts an historical resource dating to the work done by Noranda between 1988 and 1991.

In their first stab at drilling, Foundation and Alto hit several promising intercepts in just nine holes, including 4.88 grams gold per tonne over 27.3 metres starting at 170 metres depth and 1.12 grams gold over 111.3 metres from 134 metres downhole.

The partners got their second round of drilling underway in early June and received results from the first three holes. Each hole cut through both the Main and North zones, which are parallel and sit less than 100 metres apart. Gold in both zones is associated with pyrite and occurs within strongly sheared and altered mafic to intermediate metavolcanics and quartz-feldspar porphyry intrusive rocks.

Hole 23 returned 34.5 metres grading 1.93 grams gold, starting 80 metres downhole and including 13.9 metres of 3.07 grams gold, from the North zone. The drill then encountered the Main zone at 206 metres depth, hitting 21.2 metres of 0.72 gram gold.

Hole 24 hit the Main zone first, returning 12.5 metres of 1.06 grams gold from 42 metres depth, and then cut 26.2 metres averaging 1.09 grams gold from 153 metres. And hole 25 returned 51.6 metres of 0.82 gram gold from the Main zone, and then hit 13 metres of 3.06 grams gold in the North zone.

Foundation, as the project operator, is planning to drill at least 8,000 metres in the current program. The company has three goals in mind: to increase confidence in the historic resource, to expand the historic resource laterally and at depth, and to test several promising satellite targets.

The historic resource, based on 37 shallow diamond drill holes, stands at 5.1 million tonnes grading 1.4 grams gold. Noranda’s work outlined a deposit that starts on the surface and is contained in three tightly-spaced zones, known as the Main, North and East zones.

In addition, Foundation will be drilling in the Span Lake area, which lies 5 km to the southwest on the edge of the property. Just across the property’s border is Moss Lake Gold Mines’ (MOK-V) namesake deposit, which carries an inferred resource of 50.9 tonnes grading 0.93 gram gold for 1.5 million oz. gold. Foundation’s drilling will test for extensions of that deposit onto the Coldstream ground. Last year, channel sampling at Span Lake returned a best result of 31.8 grams gold over 0.8 metre.

The summer work program will also include prospecting and surveying at the Sanders zone, an area 500 metres northeast of the Main zone that Lacana Mining drilled in 1989, but was not included in the historic resource estimate. Foundation punched one hole into the zone last year and hit 27.5 metres of 1.16 grams gold, including 2.1 metres carrying 10 grams gold, which is certainly a result with enough promise to entice further exploration.

Finally, Foundation will be exploring two other areas, called Goldie and Iris, with the goal of defining drill targets. Channel sampling at Goldie in 2009 returned a best result of 30.7 grams gold over 1.2 metres while a grab sample from Iris returned 15.8 grams gold.

The Coldstream property sits along the Trans-Canada Highway, 115 km west of Thunder Bay. A major power line and a rail line pass just north of the property.

Foundation is earning a 60% interest in the project from Alto by handing over 1 million shares and spending $3 million on exploration within four years. The company can then increase its stake to 70% by funding project expenditures through to the completion of a feasibility study.

On news of the latest drill results Foundation’s share price lost half a penny to close at 36¢. Foundation has a 52-week trading range of 13¢-90¢ and 22 million shares outstanding.

Alto’s share price did the opposite, gaining half a penny to close at 6¢. Alto has a 52-week trading range of 2.5¢-9.5¢ and 120 million shares outstanding.