Skyline drilling to expand reserves

The company is operator and 100%-owner of the Johnny Mountain mine in northwestern British Columbia which developed some technical problems after start-up last summer. Now under new management, Skyline is currently looking for a joint venture partner to aid in efforts to sustain an operational turnaround.

According to William Price, president and chief operating officer, the results of recent drilling conducted from the decline ramp down to the nine level are expected to increase over-all reserves. Earlier this year the company downgraded geological reserves originally estimated at 1,087,875 tons grading 0.704 oz gold to a more conservative 686,000 tons grading 0.57 oz gold, using a 0.3 oz cutoff. Reserve calculations are based on values in the 16, Discovery and Zephrin veins.

Skyline said exploration drilling completed to date has confirmed mineralization in the 16 vein for a length of 1,312 ft at a depth of 925 ft. The vein remains open along strike, to the east and at depth and will be evaluated by an intensified surface and underground drilling program in the coming months.

Recent drilling (all true widths) intersected 2.95 ft of 0.608 oz gold; 2.95 ft of 1.417 oz gold and 5.24 ft of 0.797 oz gold. The company said values were encountered in an area 325 ft deeper than the deepest previous ore grade intersection in the 16 vein.

Vertical and horizontal extensions of a high grade ore shoot in the 16 vein between the nine-and- 10-levels were also encountered in recent work. The ore shoot is in close proximity to existing mine workings and will be developed through the extension of existing drifts. New results include: 2.29 ft of 0.988 oz; 1.6 ft of 0.661 oz; 2.6 ft of 0.147 oz and 1.6 ft of 7.77 oz. Drilling in this area had previously returned 2.95 ft of 3.385 oz and 4.59 ft of 0.616 oz.

The company also noted that recent work established ore grade material above the 11 level in the 16 vein. With the mineralization open on strike in both directions, the company plans to mine the area through a new portal at the 12 level that will be developed this summer. Results are: 1.3 ft of 3.020 oz gold; 3.9 ft of 0.475 oz and 9.1 ft of 1.237 oz.

An entirely new structure named the Victoria vein was also discovered lying 98 ft north of the 16 vein between the nine-and-10-levels. Several holes in the area returned lower grade mineralization over narrow widths. The best result was 5.9 ft grading 0.23 oz gold.

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