Nevada Pacific targets Limousine Butte (June 09, 2003)

Vancouver-based junior Nevada Pacific Gold (NPG-V) is preparing to drill-test the Resurrection Ridge zone on its 40-sq.-km Limousine Butte gold project in east-central Nevada.

Resurrection Ridge is one of five disseminated oxide gold zones identified at Limousine Butte.

Previous drilling on the zone is highlighted by the following results:

— Hole LIM-40 — 45.8 metres (from 27.5 metres below surface) running 1.4 grams gold per tonne.

— Hole LIM-46 — 21.4 metres (from 126.6 metres) grading 4.7 grams gold, including 7.6 metres (from 128.1 metres) averaging 9.6 grams.

— Hole LIM-48 — 30.5 metres (from 19.8 metres) of 1.4 grams gold.

— Hole SKB-128 — 44.2 metres (from 16.8 metres) at 1.8 grams gold.

— Hole SKB-151 — 12.2 metres (from 65.6 metres) grading 4.7 grams gold, including a 4.6-metre interval (from 71.7 metres) of 7.2 grams.

— Hole SKB-262 — 35 metres (from 88 metres) averaging 4.6 grams gold, including 10.7 metres (from 90 metres) running 11 grams.

Drilling at Resurrection Ridge indicates that the higher-grade gold mineralization is controlled by northwest- and northeast-running structural controls, with the best grades occurring at structural intersections. The company is seeking permits for a 3,000-metre drill program designed to test the intersections laterally, as well as updip and downdip.

The company recently regained outright ownership of Limousine Butte by picking up the half-interest it didn’t already own from Newmont Mining (NEM-N). Newmont retains a net smelter return varying between 1.5-2.5% plus a US$1-million advance payment once commercial production begins.

In August 2002, Newmont pegged the project’s mineral inventory at around 35.8 million tonnes running 0.55 gram gold per tonne, or 620,743 contained gold ounces, based on a cutoff grade of 0.2 gram gold. The inventory includes material from Resurrection Ridge, as well as from the Black Valley, Mustang Hill, Pony Express and Coffee Mug zones.

The property is centred on a large hydrothermal system. Nevada Pacific’s exploration efforts are focused on finding district-scale, disseminated, structurally controlled and skarn-hosted gold deposits associated with a large mineralized porphyry complex. Exploration for copper in the 1960s uncovered a deep-seated porphyry system in the southwestern portion of the property.

In the 1980s, a joint venture between Alta Gold and Echo Bay Mines (ECO-T) recovered just under 100,000 oz. gold via a heap-leach operation at the Golden Butte mine, along the northeastern corner of the property.

Elsewhere in Nevada, Nevada Pacific has picked up the Buffalo Canyon gold project by staking 44 lode claims on the west flank of the Shoshone Range, about 4 miles south of the town of Ione.

The property, which came with a price tag of US$8,800, is home to an intrusion-related gold system with five known gold targets. Only the Main zone has seen drilling.

Grid soil sampling has delineated the Main zone over a 1-by-1.2-km area, including a 300-by-300-metre area defined by gold grades exceeding 145 parts per billion.

In the 1990s, 17 reverse-circulation holes were drilled to test a portion of the zone outcropping on a hillside; they returned up to 0.93 gram gold per tonne over 40 metres.

Nevada Pacific has already begun compiling data on the five zones, in conjunction with mapping and sampling.

Meanwhile, Nevada Pacific has abandoned its plan to buy out of receivership the Keno Hill silver mine, 350 km north of Whitehorse, Y.T.

The company said its decision was based on “a thorough evaluation of the assets, discussions with the Yukon territorial governmentm and other due diligence investigations.”

In return for $3.6 million, Nevada Pacific stood to gain the 105-sq.-km property along with surface buildings and a 450-tonne-per-day mill.

In 1996, the property’s measured and indicated resource was estimated at 680,000 tonnes grading 1,033 grams silver per tonne, plus 5.08% lead and 4.05% zinc. An inferred resource was pegged at 190,000 tonnes running 992 grams silver, 5.92% lead and 7.28% zinc.

Nevada Pacific was planning to revive the past-producer by using new ground-support techniques and lower-cost mining methods.

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