Fortune drilling cuts high gold grades (May 26, 2003)

Infill drilling by Fortune Minerals (FT-T) on the Nico polymetallic deposit, 160 km northwest of Yellowknife, N.W.T., has intersected high gold grades.

Fortune, which has a 35-hole program under way to test extensions of the deposit’s high-grade core zones, drilled five holes to test extensions of known resources and to establish continuity with “stranded” resource blocks. All five intersected gold-cobalt-bismuth mineralization.

Hole 03-255 intersected 21 metres grading 9.5 grams gold per tonne, with 0.05% cobalt and 0.04% bismuth. The intersection included a 2-metre interval that ran 35.8 grams gold with 0.12% cobalt and 0.18% bismuth.

A hole drilled roughly parallel to hole 03-255, from a collar 35 metres to the north, intersected 4 metres grading 8.1 grams gold per tonne, plus 0.15% cobalt and 0.01% bismuth.

Another, drilled from a collar 45 metres south of hole 03-255, returned only 0.01 gram gold per tonne over a 29.5-metre mineralized length but graded 0.17% cobalt and 0.14% bismuth.

Two other holes were drilled on a section 100 metres farther west. One, almost due west of hole 03-255, encountered a 41.7-metre zone grading 0.21% cobalt, 0.1% bismuth and 0.3 gram gold per tonne. The other, farther to the south, intersected three mineralized areas. The narrowest and shallowest was a 1-metre zone running 4.5 grams gold per tonne with 0.07% cobalt and 0.01% bismuth. A 6-metre-long core length further down the hole ran 0.49 gram gold per tonne with 0.13% cobalt and 0.06% bismuth. The third zone, 5 metres wide, returned 0.29% cobalt, 0.09% bismuth and 0.07 gram gold per tonne.

An earlier hole, the first of the program, had intersected comparable grades on the down-dip extension of the deposit’s Lower zone, extending the inferred vertical depth of the Lower zone to 212 metres.

Mineral resource calculations at Nico indicate a resource of up to 70 million tonnes grading 0.575 gram gold per tonne, with 0.08% cobalt and 0.09% bismuth, based on a minimum cutoff grade.

An economic assessment used prices of US$325 per oz. for gold, US$7 per lb. for cobalt and US$3.25 per lb. for bismuth, to define an economic cutoff of $51 per tonne for underground mining and $17-20 per tonne for open-pit mining. That cutoff grade gives an indicated underground resource of 4.5 million tonnes grading 3.55 grams gold per tonne, 0.16% cobalt and 0.25% bismuth, plus a separate, near-surface resource of 2.7 million tonnes grading 0.73 gram gold per tonne, 0.12% cobalt and 0.15% bismuth.