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By Shane Lasley
Mining News 

Excited junior adds winter drill program

A 7 million-ounce gold resource is the target of International Tower Hill's recently announced exploration plans at Livengood

 

Last updated 11/30/2008 at Noon



In an economic climate that is causing most juniors to scale back exploration projects, International Tower Hill has expanded its exploration program at the Livengood gold property north of Fairbanks.

The addition of a winter exploration program, scheduled to begin in February 2009, is the result of the success of the junior's 2008 summer program.

Vancouver, B.C.-based International Tower Hill updated its resource estimate for Livengood by including about half of the assay results from this summer's drilling, computing a gold resource that doubles a previous resource estimate based on the company's 2007 exploration program. The junior anticipates another major resource expansion when pending 2008 assay results are included in a further update due in the first quarter of 2009.

ITH expands exploration

Based on preliminary results of this summer's drill program, International Tower Hill decided to mount a major winter drill program at the 10,875-acre Livengood property.

The company expects to drill 7,000 meters this winter and a minimum of 10,000 meters next summer. The final decision on drill targets for the winter program will be made when assay results are returned from the remaining 25 percent of drilling performed this year.

International Tower Hill has budgeted C$6 million for the 2009 exploration program at Livengood. The junior said it plans to continue with the expansion of the deposit in the newly discovered Deep and Far East zones as well as continue exploration of the Core zone. If the new large areas of surface gold return positive results, it could double the area of mineralization currently outlined in the current existing resource estimate for Livengood.

The company's target is to increase the gold resource at Livengood to 7 million ounces by the second quarter of 2009, International Tower Hill Mines president and CEO, Jeff Pontius, told delegates to the Alaska Miners Association 2008 annual convention.

Winter drilling to expand Core

The company has outlined about a 3,000-acre, or 1,214-hectare, main target area on State of Alaska Mental Health Trust land, and has focused its exploration on the 500-acre, or 202-hectare, Core zone. The winter program has two primary targets for expanding the Core zone to the northeast as well as to the southwest of the main body of mineralization.

Drilling in the northeast target area will focus on providing continuity to mineralization previously discovered, extending the deposit in that direction. The target southwest of the Core Zone was identified by modeling existing drill data as well as surface geochemistry of the area.

Following anticipated completion of winter drilling in the second quarter of 2009, the company plans to update a resource estimate that will be used in a preliminary economic assessment of the deposit currently scheduled to be released in mid-2009.

"We have a very aggressive winter drilling program that is going to kick off in February and then we will move into a more typical summer drilling program," Pontius said.

Assays, stocks to determine program

International Tower Hill geologist Heather Kelly told Mining News the company will have a better idea how intensive the winter drill program will be in each expansion region after outstanding assay results are returned from the late phase of 2008 drilling.

The winter program also will be dependent on the junior's year-end stock position, according to Kelly. Though International Tower Hill has felt the effects of the global financial crisis, it has fared substantially better than many of its peers in the junior mining sector. The company's stock is only down about 35 percent from a year ago compared to the S&P/TSX Venture Composite Index - representing about 40 percent of both junior and major mining companies worldwide - which has declined about 75 percent over the same time period.

"I think that (International Tower Hill's) share price holding up in this market is due to the reality of Livengood as a real source for future gold - gold banked in the ground if you will. Just imagine what it will be when market conditions improve," Kelly said.

Livengood tagged world-class

The resource estimate released in October upgraded a large portion of the resource to the indicated category. All of the 1.889 million-ounce gold resource (at a 0.50 g/t gold cutoff) based on 2007 drilling at Livengood was in the inferred category. The midseason 2008 estimate places about 46 percent of the gold resource in the indicated category and the remaining 54 percent in the inferred category.

When calculating the resource using a 0.50 g/t cutoff, the Livengood deposit has an indicated resource of 69.53 million metric tons with an average grade of 0.83 g/t for a total of 1.86 million ounces of gold. In addition, the deposit has an inferred resource of 87.88 million metric tons with an average grade of 0.77 g/t for a total of 2.17 million ounces of gold.

The data included in the resource estimate reinforces International Tower Hill's belief that the Livengood deposit could become one of North America's largest new gold discoveries. The company said it expects another significant increase in the resource when the remainder of the 2008 drilling results is included in the resource estimate the company plans to release in early 2009.

"We believe we are sitting on a world-class gold deposit here at Livengood," Pontius said.

Additional assays expand potential

Assay results released by the junior on Nov. 17 continue to expand the deposit and reinforce the CEO's belief that Livengood is world-class.

The results, according to International Tower Hill, increase the area covered by higher grade mineralization by about 30 percent over what was included in the midyear resource estimate.

The company anticipates that the Livengood deposit will expand substantially following the planned winter drilling program. The most recent round of drill results reveal two promising areas. Drill hole MK-08-31 intersected 139.3 meters grading 1.79 g/t gold, highlighting the potential of expanding the deposit to the north. Drill hole MK-RC-0094, which is a step-out hole about 300 meters to the east, intersected 48.8 meters grading 1.67g/t gold and an additional 33.5 meters grading 1.32 g/t gold and underscoring the potential to continue expanding the higher grades in that direction.

The company said that many of the recent drill holes were terminated while still in mineralization, indicating that the lower sedimentary sequence represents a significant host to mineralization and indicating the potential for expansion at depth.

The junior is still awaiting results from about 25 percent of the drilling completed this year. Pending results are primarily from the southwest expansion area of the Core zone.

Golden location

The ITH CEO told the luncheon attendees the large Livengood bulk-tonnage deposit is the source of around 880,000 ounces of placer gold recovered from the surrounding streams.

The oxidized mineralization, according to Pontius, starts near the surface and continues down to 150 to 200 meters and is very amenable to heap leach recovery. He said the sulfide ore also has reasonably good cyanide recoveries and the company is testing to find out what the optimum mix would be between a mill and heap leach.

Lying only about 70 miles or 110 kilometers north of Fairbanks, the property is in a logistically favorable location. The Elliot Highway - the haul road running from Fairbanks to the oil fields on Alaska's North Slope - dissects the property. The property also has the advantage of lying within about 35 miles, or 56 kilometers, north of the Fairbanks power grid.

Alaska is our future

"Alaska is our future," Pontius answered the self-directed question, "What is the future for ITH?"

The International Tower Hill CEO said in 2009 the company will focus most of its money and time on Livengood. In addition to expanding the resource, the company plans to move the project into the economic study process next year.

"We are also very keen on moving forward our new discovery projects. We have a number of very exciting projects in the state, but a lot of that work will come after we move Livengood a little farther than it is today." Pontius continued, "We are very driven right now with expanding our resources as quickly as we can."

"We still believe there are a lot of discoveries to be had in the Alaskan Belt and we are very committed to bring those discoveries to the benefit of our shareholders, so we are out there trying to make new discoveries," Pontius said. "We are an Alaskan-focused exploration company, and we are committed to bring new economic opportunities to the state of Alaska. While we are doing that, we want to respect the people's social, environmental and cultural values. We are here to be a part of the community, and not come in from the outside and look for the resources we can take away."

 

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