Kodiak’s Golden Mile Growing

Vancouver — The Golden Mile project is starting to outgrow its name: Kodiak Exploration (KXL-V, KXLAF-O) has traced its rich quartz vein gold system near Thunder Bay, Ont., along 8 km of strike and to a depth of more than 1 km.

The Golden Mile is the main target at Kodiak’s Hercules project, which is part of Ontario’s Beardmore- Geraldton gold belt. The company has been busy in 2008, completing more than 65,000 metres of drilling at Hercules.

The Golden Mile mineralized quartz vein system has been drill-tested for more than 3 km along strike and traced on surface for 8 km. And now a drill has intersected quartz with sulphide veining, quartz-carbonate stockwork, and sheared gabbro over an 8-metre interval at 1,027 metres depth. Assays are pending.

Hole 297 was drilled to test the depth extension of one of the highgrade shoots previously identified in what’s known as Area 51, in the centre of the Golden Mile. Earlier, hole 192 hit that western shoot higher and returned a 0.4-metre intercept grading 75.3 grams gold per tonne at 231 metres depth. Kodiak now plans to wedge off hole 297 to further probe the depth of the zone.

Another mineralized shoot in Area 51, the eastern shoot, carries high gold grades: hole 231 cut 0.4 metre grading 29.5 grams gold from 453 metres depth. And hole 252 returned 15.14 grams gold over 0.7 metre from 361 metres downhole, possibly from a third highgrade zone.

Kodiak added 5 km to Golden Mile’s strike length by finding gold and quartz showings west of Area 51 extending right to Kodiak’s property boundary. The company is planning a drill program to test this considerable strike extension.

Kodiak’s team believes that Golden Mile mineralized rock should be amenable to conventional milling and gold-recovery techniques, based on observed mineralogy. The company is now embarking on a series of metallurgical tests to verify that assumption and to move the project forward.

There are at least six other targets within Kodiak’s 1,400-sq.-km landholding in the Beardmore-Geraldton gold belt that have seen drill testing or channel sampling this year, with promising results.

At West Geraldton, some 50 km east of Hercules, the company drilled under a high-grade surface showing known as the Big Bonanza zone. The showing has produced 24 grab samples grading 4.97 grams to 118.6 grams gold, as well as a 2.3-metre channel averaging 12.2 grams gold. Early results from drilling include 5.7 metres of 5.61 grams gold from 105 metres depth in hole 6. Big Bonanza is part of the Portage shear zone, a regional structure that extends for more than 40 km parallel to the Bank-field-Tombill fault zone that hosts eight gold mines.

West Geraldton is also home to the Golden Boomerang zone, which sits 5.5 km east of Big Bonanza and is also on the Portage shear zone. As Golden Boomerang, the best drill intercept to date came from hole 18, which cut 12.3 metres of 0.68 gram gold from 14 metres depth. Additional assays are pending.

Kodiak also conducted reconnaissance exploration and first-pass drilling at Sturgeon Bridge, a discrete project 20 km southeast of Hercules. Drills hit multiple areas of mineralization, including a 0.6-metre intercept of 66.7 grams gold from 125 metres depth in hole 13.

Over at East Leitch, 33 km southwest of Hercules, drills are probing the Leitch mine system. The system has produced almost 850,000 oz. gold at an average grade of 31.5 grams gold from a mine 2 km distant from the East Leitch property. For Kodiak, the area has so far returned 0.8 metre grading 19.3 grams gold from 11 metres depth in hole 1.

And Kodiak is drilling at Maki Kidas, 20 km southwest of Hercules. The company has identified a zone on the site 1 km long where grab and channel samples grade up to 17 grams gold.

Kodiak management says the company still has some $40 million on hand, a strong cash position that will allow it to continue exploring its large and prospective landholding through uncertain economic times. The company closed a $54-million financing in late 2007, selling nearly 2.5 million flow-through shares at $4.80 apiece and more than 11 million non-flow-through shares at $3.80 each.

Of late, Kodiak’s share price has hovered near 60¢. The company has 89 million shares issued. National Bank Financial analysts rate the company as “outperform” and have maintained a target share price of $4.