Freewest, Noranda excited Lightning gold zone yields best hole yet

Five drills continue to probe the potential of the Lightning gold zone on the Harker-Holloway property of 60/40 partners Noranda (TSE) and Freewest Resources (ME). This week, the joint venture released the best results so far from the Matheson, Ont., area project.

Assays from hole 98 yielded 0.43 oz. gold per ton over 64.3 ft. at a depth of 1,771 ft. below surface. Coming second was hole 82 with another big intersection of 0.34 oz. over 75.5 ft.

These high-grade values, along with impressive assays from 27 other holes released this week, are confirming what could shape up as a major new deposit with grades averaging 0.25 oz., or better. Tonnage of at least three million tons seems likely.

To date, more than 104 holes have been completed on the project, just one mile north of the Holt- McDermott gold mine owned by American Barrick Resources (TSE). That mine hosts minable reserves of 2.6 million tons grading 0.14 oz. gold and is expected to turn out 70,000 oz. this year.

Despite rumors to the contrary, officials at American Barrick told The Northern Miner the Holt-McDermott mine has not been put up for sale. “We do not have the mine on the market,” confirmed a spokesman.

Meanwhile, the Noranda-Freewest joint venture continues to pull impressive holes from the Lightning zone. The adjacent Teddy Bear property, which hosts part of the western and downdip section of the Lightning zone, is under option from Teddy Bear Valley Mines (COATS) as part of a joint venture comprising Noranda (51%), Freewest (34%) and Newmont (15%). The majority of Teddy Bear’s three million issued shares are held by Chairman Ross Hoffman and other directors.

Highlights from the 29 recent holes in the Lightning zone are as follows: 0206,0300,0300,0300, Noranda-Freewest claims Hole Depth Width Gold No. (ft.) (ft.) (oz./ton) 65W 1,676 14.4 0.28 75 1,437 22.3 0.43 77 1,377 6.9 0.22 78 1,657 16.7 0.43 81 1,742 41.7 0.42 82 1,706 75.5 0.34 83 1,650 20.0 0.19 87 1,703 32.4 0.20 91 1,355 33.4 0.24 1,401 7.9 0.57 98 1,771 64.3 0.43 101 1,748 18.7 0.34 Noranda-Freewest- Teddy Bear-Newmont Hole Depth Width Gold No. (ft.) (ft.) (oz./ton) 71 2,428 19.7 0.17 79 2,559 28.5 0.23 89 1,053 17.0 0.18 92 1,286 10.1 0.21 94 1,902 39.4 0.32 99 935 33.8 0.17

The deposit remains open down- plunge to the east beyond holes 91, 94, and 98, where the best results to date have been intersected. Widths vary between a high of 75 ft. in the east to 16 ft. toward the western section on the Teddy Bear claims.

In an interview with The Northern Miner, Noranda’s manager of evaluations, Jim Gibson, said visible gold is rare because the mineralization is associated with coarse- grained pyrite in a quartz-rich, silicified horizon. No complications in the recovery process are expected, he said, and metallurgical tests are under way at Lakefield Research.

Most of the gold occurs in the main zone, whose geometry is not fully defined yet. It dips about 80 degrees to the south and plunges east along the contact between an ultramafic footwall and mafic volcanic hangingwall.

“It’s not a straightforward, cut and dry orebody,” explained Gibson. “Although the zone is predictable, a number of displacements and flexures occur along its strike.”

More detailed directional drilling will have to be done to establish continuity of the zones, he added.

Meanwhile, the positive drill results pushed shares of Freewest to $3.40, up from around the $2.85 level two weeks ago. Noranda has options to purchase another 540,000 shares of Freewest at $4 per share by November. If the property is developed into a mine, Noranda can also purchase the first two million shares issued to finance Freewest’s share of expenses. Those shares can be purchased at market price minus a 10% discount. Freewest President Mackenzie Watson owns nearly 900,000 of the company’s eight million issued shares.

A recent report by analyst David James of Richardson Greenshields describes this play as “an alternative to the generally expensive Golden Triangle situations in northern British Columbia.”

On the property, another 15 holes have been already laid out to provide infill drilling information at 160-ft. intervals, and more detailed drilling at 80-ft. intervals is also planned. The current phase of exploration work should reach completion by mid-September. The next round of drill results are expected sometime in October.