Emgold Completes Acquisition and Expands its Buckskin Rawhide Gold Property, Nevada
07 February 2012 - 12:00AM
Marketwired Canada
Emgold Mining Corporation (TSX VENTURE:EMR)(OTCBB:EGMCF)(FRANKFURT:EML) (the
"Company" or "Emgold") is pleased to announce that it has signed a Lease and
Option to Purchase Agreement with Jeremy C. Wire to acquire the PC and RH
mineral claims, located 0.3 miles west of Emgold's existing Buckskin Rawhide
Property, in Mineral County, Nevada. The PC and RH claims (henceforth called
"Buckskin Rawhide West"), comprise 21 unpatented lode mining claims totaling 420
acres.
This acquisition expands Emgold's Buckskin Rawhide gold-silver property (the
"Property") to 73 unpatented mining claims totaling 1,460 acres. Forty-six of
these claims are under a lease and option to purchase agreement with Nevada
Sunrise, LLC and the remaining six claims were staked by Emgold. The Property
now consists of two non-contiguous claim blocks - Buckskin Rawhide and Buckskin
Rawhide West. These claim blocks are separated by claims owned by Pilot Gold
Corporation that are part of the adjacent Regent Property (see figure at
http://www.emgold.com/s/MapsBuckskin.asp?ReportID=504362).
The Buckskin Rawhide Property is located approximately 40 miles southeast of
Fallon in the Rawhide Mining District. It is adjacent to the Rawhide Mine
operated by Rawhide Mining Company. The Rawhide Mine, formerly operated by
Kennecott Minerals, is reported by Kennecott to have produced 1.47 million
ounces of gold and 11.7 million ounces of silver from the years 1988 to 2005.
The location of the Buckskin Rawhide Property in the vicinity of Rawhide Mine
does not mean that a resource will be identified on the Buckskin Rawhide
Property, but the presence of mineralized structures on the Buckskin Rawhide,
Regent, and Rawhide properties and historic mine workings in the area indicate
the potential for discovery.
Both the Buckskin Rawhide and Buckskin Rawhide West areas have volcanic-hosted
epithermal gold-silver targets with geology similar to the nearby Rawhide Mine.
The limited exploration done on the Buckskin Rawhide West property includes
geologic mapping and soil and rock sampling. Potential exists for discovery of
high grade veins and low grade bulk disseminated gold targets on the Property
through further exploration.
President and CEO of Emgold, David Watkinson, stated, "This is a strategic
acquisition by Emgold, given our continuing exploration success at Buckskin
Rawhide. The Buckskin Rawhide Property has potential for development as a
stand-alone property or for synergistic development with adjacent properties,
including one of which is the Rawhide Mine. We look forward to continuing
exploration on the property with the ultimate goal of developing an NI 43-101
compliant gold and silver resource."
Buckskin Rawhide Property Geology and Exploration
The Buckskin Rawhide Property is situated within the Walker Lane structural zone
and gold belt of western Nevada. The Walker Lane is a regional shear zone of
right lateral strike slip faulting and a known gold trend that hosts large and
small historic and currently operating gold-silver mines, including mines of the
Comstock Lode, Tonopah Mining District and Rawhide Mining District. Buckskin
Rawhide Property geology and mineralization are associated with lithologic units
and structures of the Rawhide Caldera, as well as structures from the Walker
Lane and Basin and Range.
The Buckskin Rawhide Property is an early-stage exploration property that is
prospective for both high grade vein and disseminated gold exploration targets.
Geology mapping, geophysics and geochemical prospecting have been applied to
define structures and mineralization. The Property will be explored for
volcanic-hosted epithermal gold-silver targets similar to those at the nearby
Rawhide Mine.
Since acquiring the Buckskin Rawhide Property, Emgold has made two important
discoveries: the Black Eagle High Grade Vein Target and the Chicago Mountain
Bulk Disseminated Target. The Black Eagle High Grade Vein Target was disclosed
by Emgold in news releases of January 12 and April 20, 2011, and the Chicago
Mountain Bulk Disseminated Target was disclosed by Emgold in the news release of
October, 4, 2011. The most recent Emgold news release dated January 30, 2012
provided an update of exploration activities at both Black Eagle and Chicago
Mountain. The acquisition of Buckskin Rawhide West gives Emgold a third
exploration target on the Property.
Buckskin Rawhide West Target
The geology of Buckskin Rawhide West exploration target is similar Buckskin
Rawhide. Host rocks include volcanic flow-dome complexes composed of andesite
and latite, overlain by rhyolitic and dacitic tuff-breccias and pyroclastic
deposits. Opalite sinter is present, suggesting that Buckskin Rawhide West may
be situated near the top of a hot springs system, possibly the same system that
formed the Rawhide Mining District. North to northeast-trending faults, which
are present on the claim block, indicate the existence of structures that trend
parallel to those at Buckskin Rawhide. Geophysical methods used historically to
delineate those structures included ground magnetics, VLF/EM, and radiometric
surveys.
Plans are to conduct preliminary exploration work, consisting of geologic
mapping and sampling of the Buckskin Rawhide West Target in 2012, using existing
funds to complete the work.
Note that sample results on the Buckskin Rawhide Property are preliminary in
nature and are not conclusive evidence of the likelihood of the occurrence of a
mineral deposit. However, the results do justify further exploration of the
Property.
Details of the Lease Option and Purchase Agreement
Buckskin Rawhide West consists of 21 unpatented mineral lode claims totaling 420
acres, under the jurisdiction of the BLM. The claims are under a lease and
option to purchase agreement to acquire 100% of the claims from Jeremy C. Wire,
who is the registered owner of the claims. The acquisition is subject to
approval by the TSX Venture Exchange.
Emgold has agreed to lease the property from Mr. Wire, subject to the following
payments:
Table 1
Advance Royalty Payments
---------------------------------------------
Year Advance Royalty Payment
---------------------------------------------
2012 US$10,000 (1)
---------------------------------------------
2013 US$10,000 (2)
---------------------------------------------
2014 US$10,000 (2)
---------------------------------------------
2015 US$20,000 (3)
---------------------------------------------
2016 US$30,000 (3)
---------------------------------------------
2017 US$30,000 (3)
---------------------------------------------
2018 US$30,000 (3)
---------------------------------------------
Note: (1) An initial lease payment paid 50% in cash and 50% in Emgold common
shares. (2) Lease payments may be paid in cash or Emgold common shares, at the
discretion of Emgold. (3) Lease payments may be paid in cash or Emgold common
shares, at the discretion of the Lessor. Shares will be issued at "market value"
which means the volume weighted closing price of the shares on the TSX Venture
Exchange or the most senior stock exchange or quotation system on which the
shares are then listed or quoted for fifteen (15) trading days ending on the
date that is five (5) business days before the applicable payment.
During the lease period, Emgold may conduct exploration and, if warranted,
complete a NI 43-101 Technical Report on the Property. On making the above
payments and completion of the Technical Report, Emgold will acquire 100%
ownership of the property. In the event that commercial production occurs, Mr.
Wire will be entitled to a two percent Net Smelter Royalty on production from
the property. Emgold will retain the right to purchase this royalty for $1
million, less any advance royalty payments already made.
Information Regarding Emgold
Emgold is currently in the advanced stage of permitting the Idaho-Maryland
Project, located in Grass Valley, CA. The Idaho-Maryland Mine was once the
second largest underground gold mine in California and is reported to have
produced 2.4 million ounces of gold at an average recovered grade of 0.43 ounce
per ton. Emgold has a number of earlier stage exploration properties including
the Buckskin Rawhide Property in Nevada, and the Stewart Property and the Rozan
Property in British Columbia.
For more information about Emgold, the Idaho-Maryland Gold Project and the
Buckskin Rawhide, Stewart, and Rozan Properties, please visit www.emgold.com.
Company filings are available at www.sedar.com.
The scientific or technical information contained in this news release has been
reviewed and approved by Mr. Robert Pease, P.Geo., Chief Geologist of the
Company, a Qualified Person as defined in National Instrument 43-101.
On behalf of the Board of Directors
David G. Watkinson, P.Eng., President & CEO
This release was prepared by the Company's management. This news release
includes certain statements that are "forward-looking statements" within the
meaning of applicable securities laws including statements regarding the
Company's planned work programs, expected results and potential mineralization
and resources on the Buckskin Rawhide Property. Forward-looking statements are
based on certain assumptions of the Company, including that the Company has
adequate capital to fund its proposed exploration programs, that actual results
of exploration and development activities are consistent with management's
expectations, that assumptions relating to mineral resource estimates are
accurate, the assumption that metal prices remain at current values, and that
the Company is able to procure equipment and supplies for its planned work
programs Although the Company believes the expectations expressed in such
forward-looking statements are based on reasonable assumptions, such statements
are not guarantees of future performance and actual results or developments may
differ materially from those in the forward-looking statements. Factors that
could cause actual results to differ materially from those in forward-looking
statements include exploration results that are different than those
anticipated, inability to raise or otherwise secure capital to fund planned
programs, changes to metal prices, the price of the Company's shares, the costs
of labour, equipment and other costs associated with exploration, availability
of drilling equipment and operators, development and mining operations,
exploitation and exploration successes, continued availability of capital and
financing, and general economic, market or business conditions. Investors are
cautioned that any such statements are not guarantees of future performance and
actual results or developments may differ materially from those projected in the
forward-looking statements. The Company does not intend to update or revise any
forward-looking information whether as a result of new information, future
events or otherwise, except as required by law. For more information on the
Company, investors should review the Company's filings that are available at
www.sedar.com or the Company's website at www.emgold.com.
U.S. 20-F Registration: 000-51411
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