Schaft Creek drilling returns high-grade gold for Copper Fox (October 23, 2006)

Vancouver — Partial assays from initial 2006 drilling at Copper Fox Metals’ (CUU-V, CPFXF-O) Schaft Creek project, in northwestern British Columbia, indicate a new high-grade gold zone.

Hole 06CF255 — one of eight holes in a program designed to test historical grades at the porphyry copper project and extract material for metallurgical work — intersected a 284.5-metre interval of stockwork-hosted mineralization (from 18.5 metres depth) averaging 1.48 grams gold per tonne, including a 15.1-metre section of 19.6 grams gold in the Main Liard zone.

The 8 holes tested the Breccia, Western Main Liard, Main Liard and Eastern Main Liard zones at Schaft Creek.

Mineralization was first discovered on the project in 1957 with a substantial amount of work conducted on the property since. Following a brief evaluation by Asarco in the mid-1960s, Hecla Mining (HL-N) entered into an option agreement in 1968 and conducted extensive drilling plus engineering studies geared towards development of a large open-pit copper-gold-molybdenum mine.

Hecla ceased work in 1977 and sold its interest to Teck Cominco (TCK.B-T, TCK-N) the following year. Teck continued an aggressive drill campaign looking to confirm and expand Hecla’s work and evaluate the feasibility of mine development. Further data reviews were conducted intermittently throughout the 1980s and 1990s by Teck and Western Copper Holdings, a predecessor of Western Silver — itself recently acquired by Glamis Gold (GLG-T, GLG-N).

In 2002, Copper Fox acquired its option from Teck Cominco for a 93.4% interest (70% direct and 23.4% indirect) in Schaft Creek for $5 million in spending by the end of 2006 and total spending of $15 million by the end of 2011. Teck Cominco retains a back-in option to reacquire up to a 75% interest.

A scoping study completed in late 2004 reviewed an indicated resource of 670.6 million tonnes grading 0.316% copper, 0.035% MoS2, 0.22 gram gold and 1.9 grams silver per tonne (giving a copper-equivalent grade of 0.4%) using a 0.35% copper-equivalent cutoff. A further 274 million tonnes of inferred resource was also estimated averaging 0.31% copper, 0.039% MoS2, 0.18 gram gold and 1.6 grams silver or 0.38% copper equivalent.