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By Shane Lasley
Mining News 

2010 Mining Explorers: Corvus hits the ground running

Tower Hill protégé has C$9M of exploration slated before spin-out finalized

 

Last updated 10/31/2010 at Noon



Corvus Gold Corp., a new junior formed to explore International Tower Hill Mines Ltd.'s non-Livengood assets, hit the ground running with C$8 million worth of partner-funded exploration on its four Alaska properties and a 10,000-meter drill campaign on its sole-owned gold property in Nevada.

By the time the Corvus' ticker symbol, KOR, lit up on the Toronto and New York Stock exchanges in August the new explorer was well into the summer exploration its promising Alaska projects.

Corvus' portfolio - the Terra, Chisna, LMS and West Pogo projects in Alaska and the North Bullfrog property in Nevada - provides the new junior with an array of gold and copper-gold properties from early stage to near development. This assortment will help the company meet its mandate to become a leading exploration and development company and ultimately developing into a non-operating gold producer with significant carried interest and royalty exposure.

As the Tower Hill protégé advances its current exploration assets it is on the lookout for quality projects to add to the collection.

"The way forward for Corvus is finding good prospects, joint venturing them or discovering them ourselves. And we are very actively evaluating projects in Alaska, Nevada and other places to see if we can find the right upscale potential," Corvus President Russell Myers said.

Near-term royalty

The Terra gold project located in the Kahiltna Terrane of Southwest Alaska has the potential to provide a near-term royalty stream for Corvus. Terra Gold Corp., a subsidiary Terra Mining Corp., has an option to earn up to an 80 percent interest in the high-grade gold property, and is targeting the startup of a small-scale operation there by 2012.

Terra Mining, formed in October as the result of a reverse merger with a privately held company, is a U.S.-listed corporation with 16.5 million shares and US$1.675 million in cash. Greg Schifrin, a geologist with 27 years of mineral exploration experience, is Terra's president and CEO and James Baughman, with a quarter century of experience in mineral exploration and mine development experience is the new company's COO.

"We believe that Terra Gold has the technical expertise to successfully take the Terra project to production and to fully realize the value of this high-grade gold-silver asset, which has the potential to provide a significant income stream to Corvus in the near-term," Myers said.

Corvus will collect a sliding-scale net smelter return royalty of between 0.5 percent and 5 percent, depending upon the gold price, on all precious metal production from the property and a 1 percent NSR royalty on all base metal production.

Drilling by Tower Hill in 2006 and 2007 defined an estimated inferred resource of 428,000 metric tons averaging 12.20 g/t gold, or 168,000 contained ounces, and 23.11 g/t silver, or 318,000 contained ounces, at a cutoff of 5.0 g/t gold. In addition to the Ben's Vein, which hosts the resource, drilling at two other vein structures confirm the potential for significant resource additions on the property.

According to Corvus, the gold at Terra occurs as coarse native gold and can be recovered by simple gravity methods, facilitating potentially rapid development of a small mining project.

In 2010 Terra Gold spent US$200,000 on a geophysical survey and preparatory work for a drilling and a bulk sample mining program.

To continue this work the new company has proposed a US$4.5 million work program at Terra in 2011.

US$6M Grubstake at Chisna

Corvus' most extensive exploration program in 2010 was at its 225,850-acre, or 914-square-kilometer, Chisna property, a large copper-gold porphyry project in the Wrangellia Terrane of eastern Interior Alaska. This, the earliest stage project in the company's portfolio, contains a lot of blue sky for the young junior.

To unlock this potential joint venture partner Ocean Park Ventures Corp. spent some US$6 million in exploration at Chisna in 2010 as part of its option to earn a 51 percent stake in the copper-gold prospect by contributing US$20 million in exploration expenditures over five years.

Corvus, the operator at Chisna for the first two years, kicked off the 2010 exploration by flying an extensive airborne geophysical survey over the promising prospect. To further narrow down targets for a 5,000-meter drill campaign to follow, a ground-based induced polarization survey was conducted over the most prospective areas.

The Grubstake copper-gold system, located on the southeast end of the Chisna land-package, was the primary target of the 2010 drill program.

Though assay results were still pending, Myers said that the drills cut promising geology at this porphyry copper-gold target.

"I think we have a couple of definite hits of what we were looking for at Grubstake," the Corvus president told Mining News. "We are pleased with the confirmation of the conceptual model we had at the beginning of summer."

The surface mapping, geophysics and geochemical surveys completed by the JV partners has extensively expanded the zone of mineralization of Grubstake. Soil samples with values up to 13.6 grams per metric ton gold have been collected here.

Three holes were also drill at Pow, another porphyry center about 25 miles, or 40 kilometers, northwest of Grubstake. POW-10-02, the second hole drilled at Pow, cut 23 meters of 0.38 percent copper, 0.43 g/t gold and 7.5 g/t silver. POW-10-01 cut a 23.8-meter oxidized interval of 0.13 percent copper, 0.16 g/t gold and 2.8 g/t silver. POW-10-03 was lost in a fault zone.

Fault-hosted mineralization at this prospect has returned surface samples with values as high as 13g/t gold and 9.2 percent copper.

A reconnaissance team led by Nadia Caira, Ocean Park's senior technical advisor at Chisna, has turned up a number of other targets across the 40-mile-, or 65-kilometer-, long belt of gold and copper mineralization at Chisna.

Though the partners have yet to compile all the data collected by the recon team, Myers believes the program will turn up several new drill targets.

High-grade gold near Pogo

West Pogo and LMS, two additional Alaska properties in the Corvus prospectus, are joint ventured to First Star Resources Inc. Both properties lie in the vicinity of Sumitomo Metal Mining Co. Ltd.'s Pogo gold mine, a high-grade underground producer east of Fairbanks (see First Star Resources Inc.).

LMS, located about 25 miles, or 40 kilometers, southwest of Pogo contains narrow high-grade veins containing free gold within lower grade graphitic quartzite breccias.

Based on drilling completed by AngloGold Ashanti, an NI 43-101-compliant inferred resource of 5.86 million metric tons averaging 0.89 g/t gold, or 167,000 ounces, at a cut-off grade of 0.3 g/t gold was calculated for the Camp Zone.

In an effort to expand the existing resource and to identify the extent of the high-grade gold vein zones, First Star targeted the Camp Zone with its 2010 drill program.

First Star's initial holes indicate that a geological model completed by Ed Hunter, a geologist with Fairbanks-based geological consultants Northern Associates Inc., is accurately predicting the location of the high-grade gold-veining.

"Ed had a model, and First Star fired a hole at the feeder vein system and hit it where it is supposed to be," Myers said. "For the first time we have successfully predicted the location of the cross-cutting vein mineralization and hit it."

First Star also completed geological mapping at the West Pogo prospect - which lies about 2 miles, or 3 kilometers, west of Sumitomo's underground mine.

Exploration by Tower Hill has encountered Pogo-style mineralization as well as other high-grade gold that lacks the geochemical signatures of the ore being mined at Pogo.

A fire that rolled through the West Pogo claims in 2007 has exposed the surface geology, which has greatly assisted the surface mapping completed this year by First Star this summer.

"Based on the mapping they did this year, they will put in a geophysical survey and plan on drilling that structure that is now fairly obvious at the surface," Myers told Mining News.

Six of 24 rock samples collected by Tower Hill in this burn area returned greater than 1 g/t gold, the best of which was 118.5 g/t gold.

Nevada for the winter

Corvus intends to hold sole ownership of its North Bullfrog gold project, which is located about 9 miles, or 14 kilometers, north of Barrick Gold Corp.'s multimillion-ounce Bullfrog gold mine in Nevada.

"North Bullfrog is our main focus, since it is our 100 percent project," Myers explained. "We are trying to develop another low-grade, at-surface, heap-leachable resource."

North Bullfrog currently hosts an indicated resource of 2.02Mt grading of 0.88 g/t gold and 0.45 g/t silver and an inferred resource of 0.95 Mt grading 0.78 g/t gold and 0.36 g/t silver, both at a cutoff grade of 0.5 g/t gold.

Generating targets for the winter drill program is expected to be greatly enhanced by geophysical data recently acquired from Barrick.

"Lac Minerals, which was purchased by Barrick, had flown geophysics over the whole North Bullfrog prospect area. We were able to negotiate an agreement with Barrick by which we would get all that data," Myers explained.

Corvus has budgeted C$1 million to complete a 10,000-meter drill program at North Bullfrog over the winter.

Author Bio

Shane Lasley, Publisher

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Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

 

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