Feb 11 2014
Star Gold Corp. ("Star Gold" or the "Company") announced today that the Company released a new Technical Report covering its flagship property, the Longstreet Property, located near Tonopah, Nevada (referred to herein as the "Longstreet Property" or the "Longstreet Project").
The Technical Report was produced under the National Instrument (NI) 43-101 standards; please refer to the Cautionary Statement Regarding Mineral Resources set forth at the end of this Press Release.
The independent Technical Report entitled "Technical Report on the Longstreet Gold-Silver Property " (the "Technical Report" or "The Report"), dated December 15, 2013, was prepared for Star Gold by Agnerian Consulting Ltd. ("Agnerian") Agnerian Consulting has no direct or indirect interest in Star Gold Corp.
The Technical Report is available on the Company's website at: http://www.stargoldcorp.com/
Several targets within the Longstreet Property have been tested via a total of 462 drill holes completed to date. This latest Technical Report examines the drilling conducted at the Main Zone. Most of the historical drilling has been comprised of relatively shallow (approximately 100 ft. deep) air track or reverse circulation ("RC") holes, with only fifteen diamond drill holes completed by former operators and four diamond drill holes completed by Star Gold during its 2012 and 2013 exploration programs. This Technical Report is based upon a review of: previously produced technical reports covering earlier exploration; publications on regional geology and types of gold mineralization; and recent drill results.
"This updated Technical Report, including the shallow pit design, low strip-ratio and the anticipated low operating costs demonstrates the likely potential for a starter pit at the top of the Main Zone. Agnerian's Report places some economic parameters around such a plan by designing a pit and using explicit operating cost assumptions, further discussed below, which result in this Report demonstrating the potential to generate positive operating cash-flows for the project. The next step is to produce a scoping-study type review which will formalize cashflows, financing requirements, operating costs and the capital requirements necessary to construct a starter pit," said David Segelov, President and CEO of Star Gold Corp.
The Technical Report concludes that:
- At a pit discard cut-off grade of 0.137 g/t Au (0.005 oz/ton Au), the Mineral Resources of the Main Zone of the Longstreet property total approximately 4.4 million tonnes of Indicated Mineral Resources at an average grade of 0.64 g/t Au (0.022 oz/ton Au) and 15.6 g/t Ag (0.55oz/ton Ag), containing approximately 91,000 ounces of gold and 2.2 million ounces of silver, and 305,000 tonnes of Inferred Mineral Resources at an average grade of 0.48 g/t Au (0.017 oz/ton Au)and 14.6 g/t Ag (0.51oz/ton Ag), containing approximately 4,750 ounces of gold and 143,000 ounces of silver.
- The Longstreet Mineral Resources are contained in a conceptual open pit, and comprise approximately 84% of the global Mineral Resources, with an ore-to-waste strip ratio of 1:0.56.
- Of the 462 drill holes completed, between the 1980s through 2012, by Star Gold and earlier operators on the Main Zone, 420 holes encountered gold and silver mineralization of more than 0.2 g/t Au and 10 g/t Ag over intervals ranging from 1m to approximately 85m;
- The Longstreet Project area is underlain by Oligocene age poorly to moderately welded and brecciated and altered rhyolitic lapilli tuffs. Regarding the Longstreet Property, the Report states: "Hydrothermal alteration comprises argillization, silicification, and K-feldspar alteration, similar to the alteration assemblage associated with the gold mineralization at the Round Mountain Mine in Nevada."
- Exploration data also suggest that the likely environment of gold and silver mineralization (at the Main Zone) is the set of veins and fractures peripheral to a collapsed caldera, which has undergone pervasive hydrothermal alteration
At the core of the Technical Report are operating cost assumptions, recovery of gold and silver assumptions and assumption on long-term prices of gold and silver. All these variables are taken into account to make an operating model based on the proposed design of the starter pit. The key assumptions are outlined below:
- Total operating cost of US$7.25 per tonne, with approximate amounts of:
- $2.95/t mining cost.
- $4.00/t processing cost.
- $0.30/t general and administration.
- Process plant recovery of 80% of the gold and 13% of the silver by cyanidation of the mineralized rock in a Carbon-in-Pulp (CIP) plant.
- Assumed production rate in the order of 8,000 tonnes per day.
- Prices of US$1,350/oz Au (US$43.40/g Au) and US$23/oz Ag (US$0.74/g Ag). Agnerian notes that these are considered as the long-term price for gold and silver in terms of Mineral Resources.
- Gold-to-silver ratio of 1:60.
- Average dilution of 5% of waste material in the conceptual open pit.
- Ore-to-waste strip ratio of 1:0.56.
- Net smelter returns ("NSR") royalty of 3%.
The resultant operating cash-flows are outlined in Figure 14-9 of the Report on Page 83.
The Technical Report makes recommendations for further exploration work to assess the
potential existence of bulk mineable gold-silver deposits on the Longstreet property including:
- Advance the Longstreet Project by carrying out a Preliminary Economic Assessment ("PEA") based on the updated resource estimate. The preliminary budget for the PEA would be approximately one hundred fifteen thousand dollars ($115,000).
- Star Gold continuing to explore for gold and silver on the Longstreet Property which includes a program of diamond drilling to extend the zones of known Au-Ag mineralization at the Opal Ridge and Cyprus Ridge target areas, and consists of 6,000 m of diamond drilling in 30 drill holes, or a combination of RC and diamond drill holes. The preliminary budget for this program would be approximately two million dollars ($2,000,000) million.
QUALIFIED PERSONS
Hrayr Agnerian, M.Sc. (Applied), P.Geo Principal of Agnerian Consultants, Richard E.
Routledge, M.Sc (Applied), P.Geo, and René Gharapetian, P.Eng. and Qualified Persons under
NI 43-101 who are independent of the Company, have prepared and authorized the release of the
mineral resource estimates presented herein.