Contango ORE Announces Results of 2012 Exploration Program
HOUSTON--(BUSINESS WIRE)-- Contango ORE, Inc. (CTGO.PK) announced today the preliminary results on a portion of its 2012 exploration program at its approximately 726,000-acre Tetlin gold-copper project in east-central Alaska. Approximately 675,000 acres of the project are fee-simple lands leased from the Tetlin Village Council near the town of Tok, Alaska. The prospective acreage falls within two recognized mineral belts, the prolific Tintina Gold Belt which trends northwest through the northern Tetlin project and a less well defined northeast-trending copper porphyry mineral belt referred to here as the Triple Z Porphyry Copper Belt. No historic mining, or even significant exploration activities, were conducted on Tetlin lands until the Company completed its first reconnaissance exploration program in 2009. Subsequent surface sampling methods revealed several gold and gold-copper anomalies on the project, with the Chief Danny prospect constituting the most advanced of these. Several other identified anomalies have not yet been followed up on due to the Company's focus on defining the Chief Danny and the Peak zones in the Chief Danny prospect. The Company recently renegotiated its lease terms with Tetlin to release the Company from the obligation to return half of the leased lands after the initial ten year term, allowing for the orderly exploration and follow up of these identified anomalies as well as the exploration of several untested prospects on the lease.
The approximately $6.0 million 2012 exploration program included two diamond core drilling rigs primarily focused on the Chief Danny prospect where promising drill results were generated in 2011. During 2012 the Company collected 82 surface rock samples and 1,029 top of bedrock soil auger samples at the Chief Danny, Taixtsalda and MM prospects and completed 36,004 feet of HQ-size diamond core drilling in 36 holes at the Chief Danny prospect. Geochemical results have now been received for all of the geochemical samples. Additional petrographic, geophysical reinterpretation and data analysis work is on-going and will be reported at a later date when completed.
The Chief Danny prospect is located in the Tetlin Hills approximately 10 miles southeast of Tok, Alaska, and is connected to the paved Alaska Highway via the seasonal Chief Danny and all-weather Tetlin Village roads. Drilling conducted in 2011, along with surface samples, revealed numerous northwest-trending gold and copper zones over a 9-square mile area of the Chief Danny prospect. Drilling completed in 2011 (11 holes, 8,056 feet) intersected gold, silver and copper mineralization in 5 of 11 holes drilled on eight separate geochemical and/or geophysical targets generated during previous work programs. Significant drilling results from 2011 include 12 feet grading 3.1 parts per million (ppm) gold, 300.2 ppm silver and 0.26% copper in hole Tet11-05 and 21.2 feet grading 7.4 ppm gold, 4.9 ppm silver and 0.15% copper in hole Tet11-07.
The 2012 exploration program has expanded on previously drilled areas and intercepted high grade gold and copper mineralization in the newly designated Peak Zone discovery, as shown in Table 1, with copper and silver values shown on Table 2. The results from Holes 1216-1219 contained high gold values over substantial widths, with the best section grading an average 192 feet grading 11.996 ppm gold, 9.1 ppm silver and 0.243% copper in hole 1218 including 14.5 feet grading 46.148 ppm gold, 25.9 ppm silver and 0.518% copper in hole 1218 and 120 feet grading 0.309 ppm gold, 71.6 ppm silver and 1.114% copper in hole 1238 (Table 1). In general, all of the holes intercepted a 100 to 125 foot wide zone of alteration and mineralization. The mineralization dips at a low angle to the north and trends northwest-southeast. In addition to gold, silver and copper, other anomalous metals include arsenic, bismuth, cobalt, molybdenum and tin with lesser, more sporadic anomalous lead and zinc.
Following discovery of the Peak Zone, additional drilling was completed along strike to the northwest and southeast, eventually extending gold and/or copper mineralization over approximately 1700 feet of strike (see holes 1241-1249, and 1258 through 1260, Tables 1 and 2). Gold grades in excess of 1 ppm were encountered in all of these holes. Alteration and sulfide mineralization styles were identical along the entire strike length drilled in 2012.
Mr. Brad Juneau, President of the Company, said, "The preliminary results of our 2012 exploration program at our Tetlin lease site exceeded our expectations in terms of gold and copper grade as well as thickness. While we have found outstanding rocks in terms of grade/thickness, we do not believe we have yet identified a commercial resource. Our challenge now is to determine the extent of the newly discovered Peak zone/Chief Danny areas, and to try to locate additional mineralized zones with similar mineralization. We are currently working on a geophysical model that ties the known drilling results to all available surface samples and geophysical data, in an effort to improve the success rate of our drilling program. Our goal is to identify sufficient mineral resources by the end of 2013 to justify initial reviews of economic and engineering parameters on the Chief Danny prospect. We want to acknowledge the high level of cooperation afforded us by the Tetlin Village Council, as well the significant contribution made by our labor force from Tetlin and Avalon Development".
The 2012 exploratory program was designed and supervised by Curtis J. Freeman, M.Sc., PGeo, President of Avalon Development Corporation, the primary geological consultant for the project. A sample quality control/quality assurance program was implemented on all drilling and surface geochemical sampling conducted on the Tetlin project. Drill cores were cut in half using a diamond saw, with one-half placed in sealed bags for submission to the geochemical laboratory while the other half was archived for possible future use. Analytical work was contracted to Acme Labs with check assay results of selected drill intervals conducted by ALS Chemex, both of Vancouver, B.C.
Contango ORE, Inc. (CORE) is a Houston-based company that engages in the exploration in Alaska for gold and associated minerals and rare earth elements. Additional information can be found on our web page at www.contangoore.com.
This press release contains forward-looking statements regarding CORE that are intended to be covered by the safe harbor "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995, based on CORE's current expectations and includes statements regarding future results of operations, quality and nature of the asset base, the assumptions upon which estimates are based and other expectations, beliefs, plans, objectives, assumptions, strategies or statements about future events or performance (often, but not always, using words such as "expects", "projects", "anticipates", "plans", "estimates", "potential", "possible", "probable", or "intends", or stating that certain actions, events or results "may", "will", "should", or "could" be taken, occur or be achieved). Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those, reflected in the statements. These risks include, but are not limited to: the risks of the exploration and the mining industry (for example, operational risks in exploring for, developing mineral reserves; risks and uncertainties involving geology; the speculative nature of the mining industry; the uncertainty of estimates and projections relating to future production, costs and expenses; the volatility of natural resources prices, including prices of gold and rare earth elements; the existence and extent of commercially exploitable minerals in properties acquired by CORE; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; the interpretation of exploration results and the estimation of mineral resources; the loss of key employees or consultants; health, safety and environmental risks and risks related to weather and other natural disasters); uncertainties as to the availability and cost of financing; inability to realize expected value from acquisitions; inability of our management team to execute its plans to meet its goals; and the possibility that government policies may change or governmental approvals may be delayed or withheld, including the inability to obtain any mining permits. Additional information on these and other factors which could affect CORE's exploration program or financial results are included in CORE's other reports on file with the Securities and Exchange Commission. Investors are cautioned that any forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from the projections in the forward-looking statements. Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. CORE does not assume any obligation to update forward-looking statements should circumstances or management's estimates or opinions change.
Significant 2012 gold drill results from the Peak discovery in the Chief Danny prospect, Tetlin project, Alaska. Sample intervals are calculated using a 0.5 ppm lower cut off for gold with no internal waste greater than 10 feet below cutoff grade. Intercepts shown are drill intercept lengths. True width of mineralization is not known.