Drill turns at Limousine Butte (October 22, 2001)

Vancouver — Partners Newmont Mining (NEM-N) and Nevada Pacific Gold (NPG-V) have launched a third round of drilling on the Limousine Butte gold property in east-central Nevada.

Initially, drilling will target the extension of the 70-ft. intercept grading 0.14 oz gold per ton hit during last year’s program. Newmont, as project operator, also plans on drilling a number of geochemical and geophysical anomalies outlined earlier this year.

Newmont is funding the program as part of an agreement to earn up to a 70% interest in the project. The major can earn an initial half-interest by spending US$1 million on exploration over four years. A further 20% can be earned by spending an additional US$2 million in years five and six. Newmont is just completing year two of the option agreement and, to date, has spent about US$750,000 on the property.

Lying in White Pine Cty., 40 miles northwest of Ely, the property covers 15 sq. miles on the eastern portion of Butte Valley, along the western edge of the Cherry Creek range. It is accessible by gravel road from the townsite of Cherry Creek.

The project area is underlain by a Mississippian sequence of sediments consisting of calcareous shale, siltstone, sandstone and massive carbonate. The Pilot shale, Joana limestone and Chainman shale units outcrop on the eastern border of the Limousine Butte property and gently dip to the west. The beds are cut by several ages of normal and thrust faults, and commonly host jasperoid-type alteration.

Since optioning the property, Newmont has completed geological mapping, chip and soil sampling, airborne magnetic and ground gravity geophysical surveys, and two rounds of reverse-circulation drilling totaling 28,565 ft. This work has resulted in the identification of a 7-mile-long corridor of alteration.

The first round of drilling completed in November 1999, consisted of 20 widely spaced holes in an area measuring 3 miles by 0.5 mile. Drilling confirmed the presence of a major hydrothermal system. Silicification, clay alteration and hydrothermal brecciation were encountered over a large area. The alteration zones are near the surface and completely oxidized. Pathfinder geochemistry present in the alteration includes arsenic, antimony, mercury, barium and tungsten. Anomalous intervals of gold were encountered in 13 of the 20 holes, with four of the holes yielding 20-to-50-ft. intercepts ranging from 0.016 to 0.061 oz.

In a second phase of drilling, completed a year ago, Newmont drilled a further 36 holes, following-up on known areas of mineralization and new targets in a 6-by-1-mile segment of the project area. Twenty-one of the 36 holes returned gold intercepts of greater than 0.01 oz.