Fire River heats up on drill results

Vancouver – Fire River Gold (FAU-V) has found numerous bonanza-grade gold intercepts even before starting a drill campaign at its Nixon Fork gold mine in central Alaska.

The company has been steadily releasing assay results from a re-evaluation program on 9,400 metres of drilling completed by previous mine owner St. Andrew Goldfields (SAS-T, STADF-O) in 2007 and 2008 but never released.

The latest bunch of results include hole 53 that hit 24 metres grading 27 grams gold per tonne, hole 49 that cut 6.7 metres carrying 110 grams gold, and hole 54 that returned 2.1 metres averaging 48 grams gold.

The results were good enough to propel the stock up 11.5¢ or 27.1% to 54¢ on 3.7 million shares traded.

Earlier in June the company released further results including 12.3 metres carrying 23.2 grams gold, 5 metres grading 19 grams gold, and 1 metre averaging 49.8 grams gold, all from the same zone. Those results helped bump the stock up 7¢ or 19.4% to 43¢ on June 3.

The company debuted last year and jumped up to a high of 75¢ a share in November before settling down to the 35 – 45¢ range this spring. The company was a spin-out of Pacific North West Capital (PFN-T), which created the new company to focus on gold assets while it continued to concentrate on platinum group and base metals.

Pacific North West originally optioned the property for US$500,000 in late 2008 after St. Andrew’s had suspended a limited production run on the site, despite pouring in US$52 million into the site. St. Andrew had given up on the project after encountering unexpected ground conditions, lower grades and lower recoverability.

The project is a fly-in property described by Fire River as a ‘turn key operation’, fully permitted and bonded with significant infrastructure already on-site.

The company has been working to sift through all the data already gathered on the site in the hopes of better understanding the complex geology.

To help understand the rocks, Fire River has set up a 12,000-metre drill program slated to start later this month. The company will be hitting surface targets as well as underground drilling on the Crystal decline, which the company reports to be in excellent condition.

The company is funding the drill program with the proceeds of a recently completed $4.2 million private-placement financing after selling 10.6 million units at 40¢ a piece.

Fire River is also working through a preliminary economic assessment on the potentially-rich tailings left on site. The first operator of the site produced 145,000 oz. at gold grades of 48 grams per tonne but only achieved recovery rates of 83%.