Eagle Hill Exploration Corporation: Updated Mineral Resource Statement Results in 126% Increase in Inferred and 61% in Indicated Gold Ounces at Higher Grade at Windfall Lake Deposit
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 07/25/12 -- Eagle Hill Exploration Corporation (TSX VENTURE: EAG)(OTCQX: EHECF)(FRANKFURT: EH0) ("Eagle Hill" or the "Company") is very pleased to announce the preparation of a second independent gold mineral resource statement for the Windfall Lake Property (the "Windfall Lake Property" or the "Property") in accordance with Canadian Securities Administrators National Instrument 43-101, by SRK Consulting (Canada) Inc. ("SRK"). The updated mineral resource statement represents a significant increase in the total amount of gold ounces and an important increase in grade due to additional drilling and improved domain modelling.
Highlights
The results of the updated gold resource indicate:
-- A 61% increase in the total amount of gold ounces in the indicated
category with a 10% increase in grade to 10.05 grams per ton of gold;
-- A 126% increase in the total amount of gold ounces in the inferred
category with a 31% increase in grade to 8.76 grams per ton of gold;
-- 40% of the Gold Resource is in the Indicated category;
-- Mineral Resource reported at a cut-off grade of 3.0 gram of gold per
tonne ("g/t of Gold"):
-- Indicated Resource of 1.665 million tonnes at 10.05 g/t of Gold
(538,000 Gold ounces)
-- Inferred Resource of 2.906 million tonnes at 8.76 g/t of Gold
(822,000 Gold ounces)
-- Over 80 percent of the mineral resource lies within an area of 450
metres by 850 metres and within the first 500 metres from surface;
-- To date, Eagle Hill's exploration costs have been approximately $10 per
ounces of gold resource discovered; and
-- Mineralization remains open along strike and at depth.
The Revised Mineral Resource Statement(i) is presented below:
Mineral Resource Statement(i), Windfall Lake Gold Project, Quebec, SRK
Consulting (Canada) Inc., July 25, 2012
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Classification/Zone Quantity Gold Contained Increase in
(tonnes) Grade Gold ounces from
(g/t) (ounces) Nov 3, 2011
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Indicated
Main Zone 1,665,000 10.05 538,000
F17 Zone - - -
Outside Zones - - -
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Total Indicated 1,665,000 10.05 538,000 61%
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Inferred
Main Zone 2,659,000 8.95 768,000
F17 Zone 178,000 7.62 44,000
F51 Zone 69,000 4.49 10,000
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Total Inferred 2,906,000 8.76 822,000 126%
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(i) Mineral resources are not mineral reserves and do not have demonstrated
economic viability. All figures have been rounded to reflect the relative
accuracy of the estimates. Reported at a cut-off grade of 3.0 g/t gold
assuming an underground extraction scenario, a gold price of US$1,200 per
ounce and metallurgical recoveries of ninety seven percent.
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Commentary
"We are pleased to be able to provide such a strong update to our initial mineral resource statement in such a short period of time. In only 8 months, we have significantly increased the number of ounces of gold and increased the grade in both the indicated and inferred categories. This confirms the immense value being realized by our systematic approach to exploration. Our efficient and cost effective drilling program has continued to deliver strong results and improved the continuity and confidence in the mineral resource," stated Dr. Jean-Philippe Desrochers, Chief Geologist of Eagle Hill. "Our updated Mineral Resource Statement reaffirms that the Windfall deposit has significant gold mineralization, with significant potential to grow in size with further systematic exploration."
2012 Exploration Program
In addition to the updated resource calculation, recent near surface drilling at Windfall Lake has identified gold mineralization that could potentially be extracted by open-pit. Several near-surface, wide intercepts of significant grade have led the company to augment the current program to examine this potential with additional drilling. Recent intercepts include:
-- EAG-12-394: 41.8m of 4.6 g/t Au (July 11, 2012)
-- EAG-12-393: 47.2m of 11.8 g/t Au (June 21, 2012)
-- EAG-12-351: 55m of 5.7 g/t Au (April 26, 2012)
-- EAG-12-318: 25m of 22.85 g/t Au (February 27, 2012)
In addition to the near surface gold mineralization present at Windfall, recent drilling has demonstrated that mineralized zones continue to a depth of 770 metres below the surface with intercepts such as 8.9 g/t gold over 14.0 metres and 5.5 g/t gold over 15.0 metres below the Red Dog intrusion (March 1, 2012 press release). This deeper gold mineralization has not been included in the mineral resource statement presented here because of the paucity of drilling in this sector. However, additional drilling below the Red Dog intrusion may continue to increase the size of the mineral resource.
The drill program initiated in late May 2012 is focusing on three main objectives:
1. Detailed definition drilling of the near surface gold mineralization
with an objective to support evaluation of mineral resource that could
be mined by an open pit operation;
2. Expansion of the known gold zones to the east through a systematic drill
pattern - the expansion of this gold mineralization to a depth of up to
450 metres could be mined through the existing ramp infrastructure at
the Windfall Lake Property; and
3. Discovery of additional continuous gold mineralization below the Red Dog
intrusion where significant gold mineralization has been discovered by
our recent drilling. Eagle Hill believes that more gold mineralization
can be found at greater depths since Archean gold deposits generally
have a much greater vertical extent then their strike length. The gold
mineralization at Windfall Lake has a current horizontal strike length
of over 2,000 metres and is still open to both the East and West.
A map of the Windfall Lake property outlining the location of the gold zones, drill holes and areas of potential expansion, together with cross-sections, a longitudinal section and pictures of core showing the mineralization style have been posted on Eagle Hill's website, www.eaglehillexploration.com/sections.
The Windfall Lake Property is located in Quebec, ranked by the Fraser Institute as one of the most favourable jurisdictions in the world for new mine development. Also favourable to mine development, is the Property's significant infrastructure including: year round road access, a 58 person camp, a recently constructed 1,450 metre underground ramp that is 5 metres in diametre, two power lines traversing the Property, and close access to skilled contractors.
Technical Description
The new Mineral Resource Statement documents significant changes relative to the previous mineral resource statement released in November 2011. The increase in tonnage and grade is primarily due to increased drilling and improved domain modelling. SRK used the same reporting parameters for this updated Mineral Resource Statement as those used in the first Mineral Resource Statement (3.0 gpt gold, US$1,200 per ounce of gold, and a gold recovery of 97 percent). The reporting cut-off grade of 3.0 grams per tonne based on the assumption that that the Windfall Lake gold deposit is amenable for underground extraction.
The gold mineralization occurs within a low pressure zone along a high strain deformation corridor trending northeast and characterized by variable hydrothermal alteration with pyrite stockwork and disseminated pyrite mineralization. Based on current exploration knowledge, the deposit was sub-divided into three zones for resource modelling. The bulk of the gold mineralization occurs in the Main Zone that was sampled by drilling on sections spaced at twenty-five to fifty metres. With the additional core drilling information acquired in 2011 and 2012, two of the previously defined gold zones (Main the East Extension zones) were combined into an expanded Main Zone. Two smaller, less-well-defined zones exist to the north (F17 Zone) and northeast (F51 Zone) of the Main Zone and are characterized by well-developed shearing but located in a separate, sub-parallel deformation zone north of the Main Zone and dipping approximately 65 degrees to the northwest.
The Windfall Lake Property database contains 567 diamond drill holes, 318 of which are located within the resource estimation area. Analytical data for the Property is primarily sourced from drilling completed between 2004 and 2012 by Murgor Resources Inc., Noront Resources Inc. and Eagle Hill. The drillhole data includes collar location, down-hole survey data, lithology codes and 55,073 sample intervals assayed for gold. The mineral resource statement is informed by a total of 142,427 metres of diamond drilling.
The mineral resources reported herein have been estimated using a geostatistical block modelling approach informed from borehole data. All zones were estimated using a traditional wireframe interpretation constructed from a sectional interpretation of the drilling data. In areas with limited drilling, the sectional interpretation was guided by grade shells constructed using the Leapfrog software. The block model was set on a grid of 5 by 5 by 5 metres, rotated by 30 degrees counter clockwise such that the block model is oriented subparallel to the general strike of the mineralization. Gold grades were estimated by ordinary kriging and compared with an inverse distance algorithm (power of two) as a secondary estimator using the same estimation parameters.
The block model was created to cover the entire area of gold mineralization at the Windfall Lake Property. Two estimation runs were used to populate the block model with gold grades for zones constrained by hard mineralization wireframes. The first and second estimation passes considered full and twice variogram ranges.
SRK is satisfied that the geological modelling honours the current geological information and knowledge. The location of the samples and the assay data are sufficiently reliable to support resource evaluation and do not present a risk to resource classification. The mineral resource model is largely based on geological knowledge derived from boreholes drilled on sections spaced at 25 metres apart in the Main Zone portion of the deposit and over 50 metres in the rest of the deposit. The geological information is sufficiently dense to allow modelling with reasonable confidence the boundaries of the gold mineralization for the Main Zone (Domain 100), while for Zones F17 and F51 (Domains 200 and 300), the geological continuity can only be inferred at the current drill spacing within the meaning of the CIM Definition Standards for Mineral Resources and Mineral Reserves (November 2011).
Generally, for mineralization exhibiting good geological continuity investigated at an adequate spacing with reliable sampling information accurately located, SRK considers that blocks estimated during the first estimation run considering full variogram ranges can be classified in the Indicated category within the meaning of the CIM Definition Standards for Mineral Resources and Mineral Reserves (November 2011). For those blocks, SRK considers that the level of confidence is sufficient to allow appropriate application of technical and economic parameters to support mine planning and to allow evaluation of the economic viability of the deposit. Those blocks located in the Main Zone can be appropriately classified as Indicated. Conversely, blocks estimated during the second pass considering search neighbourhoods set at twice the variogram ranges and all those blocks located in domains where the geological continuity can only be inferred should be classified in the Inferred category because the confidence in the estimates is insufficient to allow for the meaningful application of technical and economic parameters or to enable an evaluation of economic viability.
The mineral resource estimation work was completed by Dr. Lars Weiershauser, P.Geo. (APGO #1504), and Dorota El-Rassi, P. Eng. (APEO #100012348) under the supervision of Dominic Chartier, P.Geo. (OGQ #874) and Glen Cole, P.Geo. (APGO #1416) of SRK Consulting (Canada) Inc. Dr. Weiershauser, Ms. El-Rassi, Mr. Chartier, and Mr. Cole, are all independent Qualified Persons as this is defined in National Instrument 43-101. Mr. Chartier is registered in the Province of Quebec and has inspected the Windfall Lake gold project on June 27, and 28, 2011. SRK's Technical Report will be filed on SEDAR within the prescribed 45 days following the date of issuance of this news release. Mr. Glen Cole reviewed the content of this news release.
Eagle Hill's Chief Geologist is Jean-Philippe Desrochers, Ph.D., P.Geo., a Qualified Person registered as defined by National Instrument 43-101 who has reviewed the technical information that this press release contains.
About the Windfall Lake Property
The Windfall Lake Property is comprised of 362 contiguous claims (over 12,000 hectares) in the Abitibi mineralized belt of northern Quebec. This area between Val-d'Or and Chibougamau is known for its gold and copper production and excellent infrastructure for exploration and mining. Historically, the Windfall Lake Property has had extensive grassroots exploration work. Along with its independently acquired claims at the Windfall Lake Property, Eagle Hill has also signed options with Murgor Resources Inc., Cliffs Natural Resources Inc. (formerly, Freewest Resources Canada Inc.), and Noront Resources Inc. to acquire the Windfall Lake Property.
About Eagle Hill Exploration Corporation
Eagle Hill Exploration Corporation is a Canadian mineral exploration company focused on the exploration and development of gold and precious metal prospects. The Company is set to become an advanced stage gold exploration company with its acquisition of the Windfall Lake high grade gold project, located in Urban Township, Quebec, between Val-d'Or and Chibougamau. Eagle Hill seeks projects that contain or have potential to have large resource potential. The Company's website at www.eaglehillexploration.com and public filings at www.sedar.com provide additional information on its properties and other information with respect to its management and operations.
ON BEHALF OF THE BOARD,
P. Bradley Kitchen, President
FORWARD LOOKING STATEMENTS
Statements in this news release, which are not purely historical, are forward-looking statements within the meaning of applicable United States and Canadian securities laws, including any statements regarding beliefs, plans, expectations or intentions regarding the future. These statements involve risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements contained herein. Such risks and uncertainties may include, but are not limited to, the ability to obtain additional financing, title to mineral properties, the ability to manage growth, acquisitions of technology, equipment or human resources, the effect of economic and business conditions, the ability to attract and retain skilled personnel, the risks inherent in exploration and factors outside the control of the Company. These forward-looking statements are made as of the date of this news release, and the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although the Company believes that the beliefs, plans, expectations and intentions contained in this news release are reasonable, there can be no assurance those beliefs, plans, expectations or intentions will prove to be accurate. Investors should consider all of the information set forth herein and should also refer to the risk factors disclosed in the Company's most recent Annual Information Form filed on SEDAR which is available at www.sedar.com. This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Eagle Hill Exploration Corporation
David Matousek
Corporate Communications
604.697.5791
info@eaglehillexploration.com
www.eaglehillexploration.com
MI3 Communications Financieres Inc. (Montreal)
Nathalie Dion
514.904.1333
nathalie@mi3.ca
www.mi3.ca