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Exploration activities at the Gold Springs

The last drill program completed 77 RC holes for a total of 16,226 meters : 

• 24 holes around South Jumbo resource,
• 22 holes around North Jumbo resource,
• 19 holes around Charlie Ross resource (2021discovery),
•  2 holes on Snow target (2022 discovery),
•  5 holes on Red Light target,
•  5 holes on Horseshoe Extension target.

Assays have been received from 65 RC holes: 24 at South Jumbo, 20 of the 22 at North Jumbo, 19 at Charlie Ross, 2 at Snow, none from the Red Light and Horseshoe Extension targets.

At the South Jumbo resource, the 24 drill results received have extended gold mineralization to the west and at depth and to the north. The resource remains open along the western and eastern margins, and to the north where 4 additional holes have been completed and await results.

At the North Jumbo resource, the 20 drill results received have extended gold mineralization in a western parallel mineral block and to the south into a new structural block extending gold mineralization 200 meters south of the North Jumbo Resource with hole J-22-005 returning 1.87 g/t gold equivalent over 29 meters including 3.73 g/t over 9.2 meters, and with hole J-22-004 returning 0.57 g/t gold equivalent over 41.2 meters and 1.88 g/t over 6.1 meters. Of the 9 holes awaiting results, 5 additional holes are looking to extend mineralization further to the south.

At Snow target, the 2 first drill holes ever completed resulted in a new discovery with hole SN-22-002 returning 1.98 g/t gold equivalent* over 3.0 meters and 0.70 g/t gold equivalent over 27.4 meters.

*Gold equivalent based on US$1,800/oz gold, US$25/oz silver and 50% for silver recovery.

The 2022 core drilling was designed to test deeper portions of the systems and to collect material for metallurgical testing. The Company had completed 3 diamond core holes, one at South Jumbo, one in the Tremor target discovered in 2021 and now part of North Jumbo, and one at Charlie Ross for a total of 695.5 meters. No assays have yet been received from the core drilling.

The ground based CSAMT geophysical survey covering most of the 33 targets was completed.

2022 Drilling results:

• Charlie Ross: Expansion of the resource (see link).
• Charlie Ross: Expansion of the resource (see link).
• South Jumbo: Expansion of the resource (see link).
• North Jumbo: Expansion of the resource (see link).
• Snow: Discovery of a new gold mineralization (see link).

Five Important Positive Points:

1. Significant Growth Potential in an Excellent Mining Jurisdiction: One large project of nearly 8,000 ha in Nevada & Utah. 6 targets with Substantial M&I Resources wide open for expansion and covering only 15% of the Property, and 27 targets with significant potential.
    
2. No Royalties or Streaming agreements (except a 3% NSR on a small private land in Grey Eagle representing less than 3% of the total existing resource).
    
3. A Low Per Ounce Discovery Cost: In 2021, $11 in total, $9 after deducting some fixed expenses.
    
4. Advancing the Mining Permit in parallel with resource expansion (EA completed in both Nevada and Utah).
    
5. A Unique Financial Instrument to rapidly advance the project by giving investors the opportunity to invest In Gold Springs with a guarantee (link for more information).

Updated Resource Estimate*

The updated resource estimate, with an effective date of June 13, 2022, is summarized in the table below:

* With an effective date of 13 June 2022 and based on the drilling results as of 31.12.2021

The inferred resource is in addition to the measured and indicated resource. Numbers have been rounded, which may lead to some numbers not adding up exactly. Gold Equivalent calculation uses a gold/silver price ratio of 72 ($1,800/$25). Mineral resources that are not mineral reserves do not have demonstrated economic viability. The resource estimate reflects gross metal content that is not adjusted for metallurgical recoveries.

The new mineral resource estimate is an update from the 2020 mineral resource estimate to mainly incorporate the drilling information of the 2021 drill program conducted at the South and North Jumbo, Tremor, Charlie Ross and White Point deposits.

The updated resource estimate broken down by deposit (pit) is as follows:

* Thor gold cutoff uses a grade of 0.20 g/t due to higher overall grades

The inferred resource is in addition to the measured and indicated resource. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Numbers have been rounded, which may lead to some numbers not adding up exactly. The resource estimate reflects gross metal content that is not adjusted for metallurgical recoveries.

Property Information

The Gold Springs Project covers approximately 7,847 hectares, comprised of federal lode claims, Utah State leases, and patented mining claims held through leases and purchases (see map).

The district-scale property is a target-rich environment with six resource zones defined thus far – North Jumbo, South Jumbo, Grey Eagle, Charlie Ross, White Point and Thor. While all are open to expansion, the priority targets are to extend the North Jumbo and South Jumbo in their own surrounding areas and towards each other along a 5.5-kilometer Jumbo Trend.

The Company has identified 33 drill-targets based on +1 g/t gold (Au) outcropping samples, geologic and structural modeling, and geophysical results. Gold Springs is somewhat unique in that all of the known resources and targets are exposed on surface. With further exploration work, it is expected that additional targets will be developed under post-mineral cover.

The project encompasses several historical high-grade underground mining districts including the Deer Lodge, Fay, and the Eagle Valley districts, all within Nevada, and the Gold Springs District in Utah. The project area contains hundreds of historical workings, which began around 1897 with several mines that produced gold intermittently until World War II. The Company has been involved with the Gold Springs Project since 2010. Summaries of past exploration, drilling, and resource estimates are detailed in the 2017 NI 43-101 report and previous reports filed on SEDAR.

The Company has completed resource estimates in accordance with NI 43-101, based on the assay results from drill holes completed through 2017, for the Jumbo (now referred to as North Jumbo) and South Jumbo resources located in Utah and the Grey Eagle and Thor resources located in Nevada.

The Company has completed resource estimates in accordance with NI 43-101, based on the assay results from drill holes completed through 2021, for the North Jumbo (before referred to as Jumbo) and South Jumbo resources located in Utah and, the Grey Eagle, Thor, Charlie Ross and White Point resources located in Nevada.

The North Jumbo and South Jumbo are priority targets, located approximately 1.5 km apart at the northern and southern ends of the 5,5km Jumbo Trend. Grey Eagle and White Point occur within a collapsed caldera margin while Thor is representative of a deeper exposure of the higher-grade veins typical of epithermal systems. Charlie Ross consists of three closely spaced parallel structural zones which host mineralization in a western, central, and eastern zone, the largest of which is an extension of historic mining activities.

In November 2019, the Company drilled 14 holes at Homestake, 700 meters east of the Grey Eagle resource, on the Nevada side of the project. Homestake includes the historic Homestake mine and mill, which was in operation during the late 1800s and early 1900s. Homestake is highlighted by two main parallel 3-4-meter-thick gold-bearing high-grade veins separated by 20-30 meters of brecciated and silicified rocks with intermediate gold grades. The package of veins and breccia is surrounded by a wide low-grade stockwork zone. 

Since 2019, 5 new discoveries have been made at Gold Springs: at Homestake (2019), Tremor (2021 and part of North Jumbo resource), Charlie Ross (2021), White Point (2021) and Snow (2022).

Geology

Gold mineralization at Gold Springs is characterized by structurally controlled vein and stockwork systems that are laterally extensive, forming wide corridors of mineralization that are traceable over strike lengths of several kilometers. The structural zones are a combination of extensional and lateral faults, as well as ring fracture systems and radial faults associated with caldera margins.

Within these structurally prepared zones, mineralization takes the form of discreet veins, breccias, sheeted vein zones, stockwork veins, and zones of dissemination. The veins exhibit quartz, adularia, and low sulfide contents that are typical of low-sulfidation epithermal deposits. Examples of this deposit type include Round Mountain, Nevada; Midas, Nevada; the Republic District, Washington; and Hishikari, Japan.

These systems have been correlated with fossil hot springs, and the hydrothermal systems that underlie them are commonly found in a caldera setting. Some of the characteristics that help classify the Gold Springs systems as a low-sulfidation epithermal deposit are the observed textures of quartz, adularia, and calcite in the vein deposits. These veins of varying dimensions are typically surrounded by broad areas of stockwork and breccia-hosted mineralization, and/or areas of altered and fractured wallrock where increased permeability hosts disseminated gold mineralization.

Exploration

There is high potential to expand the current resource base and to identify additional resources at the other targets.

The Company’s goal is to continue drill programs focused on the Jumbo Trend, expanding the resources both north and south. The Jumbo Trend is characterized by extensional and translational structures generally trending north-south. Movement on these structures created favorable zones for gold deposition. In general, the North Jumbo and South Jumbo resources consist of discreet veins, breccias, sheeted vein zones, stockwork veins, and zones of disseminations over widths of 30-150 meters. The current resources are open along strike and have not been tested at depth. All mineralization starts at surface with the deepest holes reaching a depth of just 200 meters (m) below surface.

In addition to the Jumbo Trend, Charlie Ross, White Point and the newly acquired Homestake are the other high priority target.

Homestake claims are in Nevada, 1,000 m east of the Grey Eagle resource. The Homestake mineralization is largely hosted in two stacked, 2-4 m wide, westward dipping, banded quartz veins that are controlled by major north-south structures that run the length of the 1.8-km claims. The Homestake veins are well exposed for 650 m in historic slot cuts and as outcrops before they are concealed by post mineral cover to the north and south. Host rock to the veins are oxidized andesites that have been hydrothermally brecciated and contain stockwork quartz veining. Together, breccia and stockwork zones extend up to 400 m widths around the vein systems before they are concealed by post mineral cover. High-grade Au occurs in the quartz veins with strong gold and silver mineralization occurring in the host rock as well. These breccias and stockwork zones extend to the west where they host the Iris vein that roughly parallels the Homestake veins and is easterly dipping. Both the Homestake veins and the Iris vein are known to contain high-grade Au values (up to 15 g/t Au at Homestake and 38 g/t Au at Iris), with parallel trends and opposing dips between the two vein sets that there is high potential for significant gold grades at their intersection. In the north, breccias contain up to 68 g/t Au in outcrop, though typical assay results are 0.29 to 2.4 g/t Au from the breccia and stockwork zones.

For exploration progress updates, please subscribe to the Company’s Email Alert and review the recent news releases.

Metallurgy

Metallurgical test work, involving bottle roll tests at various size fractions and column tests, produced positive results indicating that the material from the North Jumbo and Grey Eagle resources is amenable to heap leaching with positive recoveries for gold.

During 2015, Kappes Cassiday Associates (KCA), Reno, Nevada, completed a set of column leach tests on three samples each from the North Jumbo and Grey Eagle. The material was crushed to 100% passing 9.5 millimeters and was leached in columns 75 millimeters in diameter and 0.6 meters in height. The material leached quickly, and the majority of the gold leaching occurred within the first 20 days (84% to 97% of total leached) and was substantially completed in 60 days.

Silver leaching was typically much slower. The cyanide concentration was increased at approximately day 85, which did result in an increase in silver recovery, from little change to a 10% increase. This change in reagent concentration significantly increased the cyanide consumption.

Using a simple average, gold recovery for the Grey Eagle and North Jumbo area were 77% and 68%, respectively. This does not take into account the weighting of the recovery by the proportion of ore type as unique ore types were not separately weighed prior to combining for testing. Globally between the two resource areas, the recovery averaged 73% for gold. Silver recovery averaged 16% and 47% for Grey Eagle and Jumbo, respectively. The cause for the lower silver recovery experienced for Grey Eagle is unknown at this time.

2015 KCA Column Tests for Grey Eagle and North Jumbo

NaCN - sodium cyanide

Additional column testing was completed on the Jumbo resource material in 2016 using Resource Development Inc. (RDI), Denver, Colorado. The metallurgical tests were conducted over 282 days to look at extraction rates over the short term and long term after a “rest period” in which no additional cyanide solution was applied. The extraction values are shown below.

2016 RDI Column Tests - Estimated Gold Extractions for North Jumbo

^* extractions after 157 days of leaching and 125 days of rest

The three columns covered a wide range of grades varying from 1.09 g/t to 0.23 g/t gold, with good recoveries even from the lower grade material. Approximately 22 kg of each type of mineralized material, crushed to a P80 of ¾ inches, were loaded into 4-inch diameter columns approximately 6 feet high. The final extractions over time are shown below.

2016 RDI Column Tests - Large Column Extraction Detail Data with Rest Periods for North Jumbo

^*Leach sequence included 84 days of leaching followed by 35-day rest, followed by 44 days of leaching, followed by a second rest period of 90 days, followed by a further 29 days of leaching.

The material was leached and sampled over a long-time frame to evaluate how much more gold and silver could be extracted over time and after rest periods during which the cyanide solution is not circulated. As can be seen in the two tables, gold recoveries increased several percent after the rest period, and silver recoveries increased significantly with increases in the double-digit percentages. Approximately 90% of the gold recovery was achieved in the first 12 to 18 days.