The Kinsley Mountain property (“Kinsley Mountain” or the “Property”) is located in eastern Nevada in Elko County between the towns of Ely and Wendover, Nevada. The Company’s Nevada subsidiary has the rights to a mining lease covering 141 unpatented lode mining claims on U.S. Bureau of Land Management (“BLM”) land covering an area of approximately 2,807 acres (1,136 ha). New staking has increased the size of the Property to 513 claims plus 6 leased patents totaling 10,410 acres (4,213 hectares). Kinsley Mountain lies approximately 75 kilometres (45 miles) southeast of the Long Canyon property where the geological and technical team of Pilot Gold Inc. (“Pilot Gold”, TSX:PLG), then part of Fronteer Gold Inc., defined a significant gold resource in what is now recognized as an emerging gold district.
Pilot Gold carried out exploration programs at Kinsley Mountain from 2011 through 2015, and has earned a 79.1% interest in the property, with Nevada Sunrise owning the remaining 20.9% interest in the Property.
2016 VTEM Airborne Survey
On December 15, 2016, Nevada Sunrise announced that a helicopter-borne VTEM and magnetic survey has been completed over Kinsley Mountain.
The VTEM survey consisted of 854 line kilometres, flown at 200 metre spacing over the northern area of the Property, and at 100 metre line spacing over the southern half, which includes the area where the Western Flank gold discovery was made in 2014. VTEM is known for its ability to detect sulphides at depths exceeding 300 metres, and can assist in defining mineralized trends. Interpretation of the survey will utilize the geophysical signature of the Western Flank Zone to assist in identifying further drill targets. Proposed drilling is primarily focused on the Secret Canyon Shale horizon, a newly-identified host horizon for high grade, Carlin-style gold mineralization lying approximately 200 metres below the historic Kinsley Mountain open pit mine.
2016 Drilling Program
Drill targets were developed by Pilot Gold for the 2016 drilling program completed earlier in 2016 using 3-D modeling software, including the integration of new and historical geological, geochemical and geophysical data as detailed below. One drill target southwest of the Kinsley Main historic pit was tested with four reverse circulation holes in 2016. The target contained similar attributes to the Western Flank deposit, including:
• The intersection of the NW-striking Kinsley fault zone with a swarm of NE-striking steep faults
• A broad, deep historical induced polarization chargeability anomaly
• Anomalous pathfinder element geochemistry in surface soil and rock samples
All four of the 2016 drill holes intersected the target Secret Canyon Shale host horizon at the expected depth in the anticipated structural environment. All holes contained areas of moderate to strong jasperoid alteration, clay alteration and strong iron oxide and/or disseminated pyrite alteration, consistent with what is observed in the Western Flank zone. However, only anomalous gold content was encountered.
Twelve new target areas have been developed for Kinsley Mountain, some of which have been confirmed to be gold-bearing based on compilation by Pilot Gold of historical drill results. The new targets have been developed within the following exploration model:
• The Secret Canyon Shale is interpreted to underlie the entire Project, encompassing over a 20 square kilometre target area.
• Gold is concentrated along NW-striking and NE-striking steep faults, and fault intersections.
• The Secret Canyon Shale has potential to host several zones of high-grade gold mineralization, similar in nature to the Western Flank Zone, and has been tested in 10 locations by widely-spaced holes over an initial 10 square kilometre area, with anomalous gold detected in all holes. Exploration is now focused primarily on this specific stratigraphic interval.
In addition to the Western Flank deposit area, Kinsley Mountain has yielded 4 additional target areas with significant intercepts of greater than 1.0 g/t gold, including:
• Western Flank East Extension: 3.46 g/t gold over 18.3 metres in PK208 (see Nevada Sunrise news release dated June 23, 2015).
• Secret Spot: 1.34 g/t gold over 25.9 metres, 1.09 g/t gold over 13.7 m and 3.02 g/t gold over 6.1 metres in PK153 (see Nevada Sunrise news release dated September 10, 2014).
• Racetrack: 1.25 g/t Au over 10.7 metres in PK180 (see Nevada Sunrise news release dated September 10, 2014).
• Central Kinsley Trend: 1.58 g/t Au over 4.6 metres in historical hole K-425 (Pilot Gold exploration files).
2015 Resource Estimate
On November 5, 2015, Pilot Gold Inc. reported the first independent resource estimate for Kinsley Mountain. The resource estimate defines a significant high-grade zone at the Western Flank along with near-surface oxide ounces. Gold mineralization at Kinsley Mountain hosts sedimentary rock-hosted, similar to that mined in Nevada’s Carlin and Cortez trends. The potential for resource expansion is excellent due to widespread alteration, prospective geology and gold at surface, and over 80% of the Property is untested by drilling. All dollar amounts quoted are in US dollars.
The resource estimate for all mineralization types, using multiple cut-offs, is:
Table 1. Kinsley Mountain Mineral Resource Estimates
|Mineralization||oz Au||g/t Au||Tonnes||oz Au||g/t Au||Tonnes||Cutoff (g/t Au)|
|Secret Canyon Shale sulphide||284,000||6.04||1,461,000||39,000||2.41||508,000||1.0|
|Dunderberg Shale sulphide and transitional||45,000||2.67||520,000||37,000||2.44||470,000||1.3|
Mineralization hosted in the Secret Canyon Shale in the Western Flank zone includes 284,000 Indicated ounces at an average grade of 6.04 g/t gold. At a 3.0 g/t cut-off grade, most of the resource remains, delineating 248,000 Indicated ounces at an average grade of 9.15 g/t gold (see Sensitivity Table below). The grade improves 51%, while the gold content is only reduced by 13%. Metallurgical testing of mineralized material from this zone suggests that it is amenable to production of a flotation concentrate with grades up to 312 g/t gold and recovery of up to 95% using a flowsheet including cyanidation of the tails (see Nevada Sunrise news releases dated January 19, 2015 and July 13, 2015). The metallurgical response indicated by testing to date allows for consideration of lower cut-off grades than might ordinarily be used in modeling Carlin-type sulphide material.
Table 2: Sensitivity Table
|(g Au/t)||Tonnes||g Au/t||oz Au||(g Au/t)||Tonnes||g Au/t||oz Au|
|Mixed + Unoxidized Mineralization|
|(g Au/t)||Tonnes||g Au/t||oz Au||(g Au/t)||Tonnes||g Au/t||oz Au|
|Secret Canyon Mineralization|
|(g Au/t)||Tonnes||g Au/t||oz Au||(g Au/t)||Tonnes||g Au/t||oz Au|
The resource estimate, effective October 15, 2015, includes three separate cut-off grades, reflecting depth from surface, oxidation, and metallurgical considerations. These include shallow oxidized rock (0.2 g/t Au cut-off); shallow transitional and sulphide mineralization, primarily hosted in the Dunderberg Shale (1.3 g/t Au cut-off), and Secret Canyon Shale-hosted sulphide and transitional mineralization (1.0 g/t Au cut-off). Cut-off grades assume an open-pit mining scenario, using a pit floor elevation generated using Whittle software, reasonable assumptions for mining and milling costs, and a $1,300/ounce gold price.
The Kinsley Mountain resource estimate was completed by Michael Gustin, Ph.D, CPG, of Mine Development Associates, Inc. (“MDA”) of Reno, Nevada, an Independent Qualified Person as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended. Estimation methods are summarized below. Further details of the estimation methods and procedures are available in a NI 43-101 technical report, co-authored and released by MDA, dated December 16, 2015 and filed on SEDAR (www.sedar.com) .
The resource estimate is based on results from 77,097 metres of historical drilling in 1,158 drill holes (9 core and 1,149 reverse circulation or rotary), as well as 59,852 metres in 222 holes, including 74 core holes and 148 reverse circulation holes drilled by Pilot Gold. Quality-control data generated during the various drill programs conducted at Kinsley were independently verified by MDA as part of the project review. The resource model consists of a detailed three-dimensional geological model including lithological, structural and gold domains derived from 25 metre-spaced sections. The low, medium and high-grade gold domains, in turn, were used to constrain the interpolation of gold grades. Blocks measure 5 x 5 x 5 metres. A total of 10,016 individual assay intervals averaging 1.527 metres in length were composited into a total of 10,037 composite intervals of 1.524 metre length. Gold assay data was reviewed statistically and visually to determine appropriate grade capping levels by domain. A total of 21 gold assays were capped prior to compositing based on the evaluation of probability plots by gold domain. In addition to the capping of assay data, the impact of anomalously high gold values was controlled by restricting their range of influence in the estimation process. Gold grades were interpolated using inverse distance to the third power (ID3).
For mineralization to be classified as Indicated, the following criteria were used:
- Indicated (Secret Canyon Shale): minimum of three composites; minimum of 2 holes within an average distance of 25 metres from the block;
- Indicated (All Other Mineralization): minimum of three composites; minimum of 2 holes within an average distance of 20 metres from the block;
All remaining estimated blocks that were not classified as indicated and that meet the elevation critieria summarized below were classified as inferred.
To ensure reasonable prospects of economic extraction, the project resources were limited to elevation levels as defined by Whittle pit shells. A pit optimization was run using a $1,300/oz gold price and parameters applicable to: (i) oxidized, potentially heap-leachable mineralization – $2.50/t processing cost, $1.41/t General and Administrative (“G&A”) cost, and a gold recovery of 75%; (ii) mixed and unoxidized mineralization that could potentially be processed by flotation, leaching of the flotation tails, and custom oxidation by roaster or autoclave – $32.00/t processing cost, $7.04/t G&A cost, and 85% recovery; and (iii) mineralization hosted within the Secret Canyon Shale, which potentially could also be processed by flotation, leaching of the flotation tails, and custom oxidation by roaster or autoclave – $28.30 processing cost, $7.04/t G&A cost, and 95% recovery. The pits were used to define the following maximum depths below the topographic surface for the potential open-pit resources at Kinsley Mountain – 125 meters below the topographic surface on the east side of the Kinsley Range and 350 meters below the surface on the western side.
Tonnage estimates are based on 129 bulk specific gravity determinations completed by ALS Laboratories for Pilot Gold, as well as historical data, which were used to assign average values to oxidation domains of the block model. Pilot Gold drill samples were assayed by ALS Laboratory in Vancouver, B.C. for gold by Fire Assay of a 30 gram (1 assay ton) charge with AAS finish, or if over 5.0 g/t, were re-assayed and completed with a gravimetric finish. QA/QC included the insertion and continual monitoring of numerous standards and blanks into the sample stream, and the collection of duplicate samples at random intervals within each batch.
Michael M. Gustin, Ph.D., CPG, of MDA, and located in Reno, Nevada, is an Independent Qualified Person within the meaning of NI 43-101 and is responsible for the Resource and its technical content and has reviewed and verified that such information is accurate and approves of written disclosure of same.
John R. Kerr, P.Eng., is the Company’s designated Qualified Person within the meaning of NI 43-101 and has reviewed and approved the technical information contained herein.
History of Exploration
Gold mineralization was discovered on Kinsley Mountain in 1984. Subsequent exploration defined sediment-hosted gold mineralization concentrated in the Kinsley trend, and includes at least five distinct deposits hosted in strata ranging from middle-to-late Cambrian in age. Gold mineralization occurs within a stratigraphic section of Middle to Upper Cambrian-age sedimentary rock units including limestone, dolomite and shale. This mineralization exhibits characteristics similar to other sedimentary rock-hosted “Carlin-type” gold deposits in Nevada. Gold enrichments occur in both bedding-parallel and structurally-controlled zones of disseminated mineralization within altered sedimentary rocks.
Between 1994 and 1999, Alta Gold Co. (“Alta Gold”) produced approximately 135,000 ounces of gold at 1.34 grams/tonne gold from oxide ore in a heap leach operation at Kinsley Mountain. Mining by Alta Gold was restricted to a cluster of deposits aligned along a northwest-oriented fault zone. Exploration drilling has identified several other mineralized centers, which are yet to be developed. Mining by Alta Gold ceased during a period of low gold prices.
Since the early days of land acquisition, Nevada Sunrise assembled a substantial historical archive for the Kinsley Mountain property, including records for 1,156 drill holes, with a total length of 244,900 feet (an average depth of only 212 feet).
Gold mineralization at Kinsley Mountain consists both of shallow low-grade oxide ore, which was mined and produced by Alta Gold, and deeper higher-grade refractory mineralization. This deeper mineralization was tested by a limited number of drill holes that yielded grades ranging from 0.235 ounce per ton gold on the east side of the range to 0.149 ounce per ton gold one mile to the northwest. By analogy, to the better-explored gold deposits of the Carlin trend, the deeper zones of gold mineralization at Kinsley Mountain could be highly prospective. Drilling by the Kinsley Mountain joint venture in 2013-2014 has outlined significant high-grade gold mineralization in the Western Flank area (see “2014 Exploration by the Kinsley Mountain Joint Venture”).
Development of Kinsley Mountain LLC Joint Venture
On April 8, 2010, Nevada Sunrise announced an option agreement with Animas Resources Ltd. (“Animas”) on Kinsley Mountain (the Kinsley Option”), which gave Animas the right to earn a 51% interest in Kinsley Mountain by spending US$1.5 million in exploration expenditures over three years. Animas agreed to spend US$200,000 in exploration expenditures during 2010 to maintain the Kinsley Option, and would act as operator of exploration at Kinsley Mountain.
Nevada Sunrise and Animas agreed to form a joint venture consistent with the form of the Rocky Mountain Mineral Law Foundation mining venture agreement upon Animas earning its 51% interest. After earning its 51% interest in Kinsley Mountain, Animas had the right to earn an additional 14% interest by spending US$3.0 million in exploration expenditures within five years, which would bring its interest in Kinsley Mountain to 65%.
On September 21, 2011, Nevada Sunrise announced the purchase of the Kinsley Option from Animas by Pilot Gold. In consideration for the purchase of the Kinsley Option, Animas received the following:
- US$350,000 cash and 50,000 common shares of Pilot Gold on the date hereof;
- 25,000 common shares on the first anniversary of the effective date;
- 25,000 common shares on the second anniversary of the effective date;
- 50,000 common shares upon Pilot Gold earning and vesting a 51% interest in the amended mining lease, summarized below, pursuant to the option agreement.
Pursuant to the amended terms of the Kinsley Option, Pilot Gold would have the exclusive right to earn:
- A 51% undivided interest, right and title in and to Kinsley Mountain through a 51% equity interest in a joint venture company to be formed at the time of such acquisition, by incurring US$1.18 million in exploration expenditures by March 30, 2013 (of which US$180,000 must be spent by May 31, 2012);
- An additional undivided 14% interest in Kinsley Mountain and in the joint venture by incurring an additional US$3.0 million in exploration expenditures within five years of meeting the initial earn-in.
2015 Exploration by the Kinsley Mountain Joint Venture
On June 23, 2015, Nevada Sunrise announced that Pilot Gold reported initial drill results to the Company from the 2015 drill program at Kinsley Mountain. Drilling within an area approximately 150 metres northeast of the high-grade Western Flank has intercepted high-grade gold in two key stratigraphic horizons, indicating the presence of a new mineralized zone that remains open to the east and west.
Drill highlights include:
- PK208: 2.34 grams per tonne (“g/t”) gold over 9.1 metres (Dunderberg shale host),and3.46 g/t gold over 18.3 metres
- (Secret Canyon Shale host);
including13.7 g/t Au over 3.0 metres;
- PK210: 2.95 g/t Au over 13.7 metres (Secret Canyon Shale host).
The new intercepts are from the Dunderberg Shale and the Secret Canyon Shale which contain most of the known gold mineralization at Kinsley Mountain and are believed to underlie a significant portion of the Project area. Pilot Gold believes the previously-discovered Western Flank zone is not an isolated occurrence and there is a high probability of ongoing discoveries at Kinsley Mountain, and that these results confirm their exploration model for the discovery of new areas of mineralization.
2015 Exploration Program
The initial 2015 field program at Kinsley Mountain is currently budgeted at US$2.0 million, including up to 10,000 metres of reverse circulation and 1,000 metres of diamond drilling. Thus far, 4,300 metres have been completed in 9 holes and one lost hole, including three that were drilled for the purpose of conducting an induced polarization geophysical survey. The remaining program will focus on following up the new discovery and will also test a number of high-priority targets across the property. Exploration of this nature is drill-intensive and sequential; the program will be continually evaluated in light of data and interpretations from each and every drill hole.
On the basis of these results the 2015 exploration program is being modified to potentially expand and connect the new zone to the Western Flank and target the “high-grade” northwest trending structures in the historical mine trend.
2014 Exploration by the Kinsley Mountain Joint Venture
2014 was a landmark year at Kinsley Mountain, with the discovery of the high-grade zone at the Western Flank, and subsequent recognition of the property-wide potential for gold mineralization in the Candland Shale and Secret Canyon formations. The 2014 drilling program consisted of 27,191 metres in 81 holes, including a water test hole, as part of a US$6.64 million exploration program.
Highlights from recent infill drilling at the Western Flank include:
- 10.1 g/t (grams per tonne) gold over 39.6 metres in PK186C, including
- 17.4 g/t gold over 21.6 metres (Secret Canyon Shale host)
- 6.05 g/t gold over 30.5 metres in PK187C (Secret Canyon Shale host)
- 4.39 g/t gold over 29.2 metres in PK188C (Secret Canyon Shale host)
- 6.88 g/t gold over 6.1 metres in PK177C, including
- 11.0 g/t gold over 3.0 metres (Candland Shale zone)
The Racetrack zone is located 1,200 metres south of the Western Flank along a potential parallel NNE trending structure where surface mineralization in the Candland Shale was intersected over a 250 metre by 300 metre area by prior operators. Six holes were drilled, with PK180 returning mineralization in both the shallow oxide Candland Shale unit and the deeper Secret Canyon Shale.
Highlights from the Racetrack area include:
- 2.69 g/t gold over 7.6 metres (Shallow oxide in the Candland Shale host) and
- 1.25 g/t Au over 10.7 metres (Secret Canyon Shale host) in PK180
Pilot Gold reported that gold mineralization at Kinsley Mountain is widespread in two stratigraphic units, the Secret Canyon and Candland Shales, with both emerging as viable property-wide targets, and that the latest results not only demonstrate continuity of the high grade at the Western Flank target, but also its broader potential as gold was detected in widely-spaced drill holes over the Western Flank trend.
Other targets tested along the Western Flank in 2014 include the Right Spot, where shallow, oxide gold mineralization was intersected in multiple drill holes; and the Secret Spot, where shallow, oxide mineralization, and deep mineralization in the Secret Canyon Shale were encountered. Gold was also encountered in the area between the Western Flank and the historical mine in three stratigraphic units.
Recent highlights from the Secret Spot include:
- 2.03 g/t gold over 7.6 metres (shallow oxide in the Candland Shale) in PK182
Permitting: Kinsley North
An amendment to the Kinsley Mountain Plan of Operations for conducting surface drilling and other activities was recently approved by the U.S. Bureau of Land Management. The amendment permits up to 20.5 acres (8.3 hectares) of drill roads and pads in the northern two-thirds of the property, with access to a number of high-priority targets defined by geochemically anomalous pathfinder elements in surface samples and intersections of NNE and NW-trending faults. The “Kinsley North” claims are underlain by the same highly prospective geology and structural framework as the Kinsley Mine and the Western Flank, and have never been drilled.
Initial Metallurgy Test Results
On January 19, 2015, Nevada Sunrise reported results from an initial metallurgical program designed to address the amenability of high-grade mineralization from the Secret Canyon host rock at Kinsley Mountain to produce a high-grade concentrate. Initial metallurgical test results demonstrate that high-grade sulphide mineralization from the Western Flank zone can produce a high-grade concentrate with excellent gold recoveries, at potentially low capital and operating costs.
At Kinsley Mountain, initial geochemical analyses of mineralized intercepts, including characterization of carbon and sulfur, ICP analysis and determination of the solubility of gold in cyanide demonstrated that the concentration of gold relative to sulfur is high relative to other sediment-hosted, Carlin-style gold deposits. As well, petrographic work showed that pyrite, within which the gold is believed to be resident, is relatively crystalline, dense (non-porous) and that there is a very small quantity of sulfides that are <20 microns. These data and observations demonstrate potential for producing a high-grade flotation concentrate, which could then be evaluated for direct sale to commercial smelters or potentially to any one of several Nevada mine operators who can process refractory concentrates via roasting or autoclaving, for final recovery of the gold.
Four samples representing a range of gold grades from 4.23 to 20.3 g/t gold and a range of cyanide solubility levels were subjected to rougher and scavenger flotation testing over a range of conditions including variations in grind size, followed by cyanidation of the flotation tails. Combined concentrate recoveries ranged from a low of 76% to a high of 89.6%. Combined with cyanidation of the flotation tails, the total recovery increased to 89.0% to 95.0%. The concentrate grades ranged from a low of 98.6 g/t gold to a high of 312 g/t gold, with gold recovery to concentrate highest in the higher-grade and less oxidized samples.
Secret Canyon gold mineralization at Kinsley Mountain, unlike more typical Carlin-style deposits, is unique in several aspects:
- The sulfides at Secret Canyon are crystalline, dense (not porous) and the lack of sulfides <20 microns make them prime candidates for flotation.
- The total sulfide sulfur content of Secret Canyon material averages about 1.0%, which is low for a typical Nevada refractory resource, indicating that flotation concentration ratios can be high and consistently produce high grade concentrates.
- The ratio of gold, in grams/tonne – to sulfide sulfur, in percent (Ratio: Au/S) is very high, ranging from 7.8 to 19.2 for the four master composites. Since refractory gold treatment facility capital and operating cost are most affected by sulfide sulfur content, the low sulfide sulfur feed grade and the high ratio of Au/S are very favourable indicators for low capital cost facilities for on-site treatment and low relative operating cost for concentrate treatment whether processed on or off-site by other commercial entities.
- Concentrate grade ranged from 98.6 to 312 g/t gold. At a US$1,200 gold price, the contained values of these concentrates range from $3,800 – $12,000 per tonne. Therefore, cost for on-site processing or shipping and processing concentrate at a commercial smelter or a local Nevada refractory treatment facility would only represent a small portion of the overall concentrate value.Concentrates were assayed for deleterious elements and were found to contain arsenic and antimony. Arsenic in the concentrate tested ranged from 0.69% to 1.22% and averaged 1.01% while antimony in the concentrate tested ranged from 0.022% to 1.58% and averaged 0.60%. While arsenic and antimony are elevated, the levels would not preclude direct sale to a smelter, sale to a concentrate blender or to a typical Nevada refractory ore processing facility.
Gary Simmons, of GL Simmons Consulting, LLC (B.S. Extractive Metallurgy), a Qualified Professional with the Mining and Metallurgical Society of America and Pilot Gold consultant, is the Qualified Person, within the meaning of NI 43-101, who has overseen the collection and verification of this data. Mr. Simmons is independent of Nevada Sunrise. Metallurgical testing was conducted at Hazen Research, Inc. in Denver, Colorado.
Surface mapping and sampling, continued modeling of historical blast hole and drill data, and drilling in 2014 have refined Pilot Gold’s targeting efforts as operator to find additional gold mineralization at Kinsley Mountain. Pilot Gold believes that the Secret Canyon Shale, host to the high-grade mineralization in the Western Flank, is a viable target, with gold values greater than 1.0 g/t over significant widths also drilled in the Secret Spot and Racetrack areas up to two kilometres to the south. Over the length of the property this horizon is virtually untested, and it is unlikely that the Western Flank is the only high-grade zone. Data support the concept that gold is concentrated at the intersections of NW to WNW and NNE to north-trending, high-angle structures. The principle target is interpreted to be the intersections of faults of these orientations with the Candland Shale and Secret Canyon Shale horizons.
2013 Exploration by Pilot Gold
In July 2013, Pilot Gold commenced a 20,000 metres drilling program as a follow-up to the 2012 campaign that defined and expanded gold mineralization over a 2.2 kilometre-long trend. Pilot Gold tested high-priority targets within a core group of claims, including the Western Flank, Candland Canyon and extensions trending NNE and SW of the historical pits.
The 2013 drilling showed that significant gold also occurs within a lower zone of silty limestone below the Candland Shale. This host horizon was neither identified nor tested by previous operators. Core drilling suggested that the tabular zones of mineralized, favourable host rock are cut by one or more high-angle structures causing collapse breccia zones where the mineralization becomes thicker and higher-grade. Drill hole PK091CA contains high-grade collapse breccia zones similar to those seen by Pilot Gold’s team at Newmont Mining’s Long Canyon project.
Assay results from the Western Flank target, located 550 metres northwest of the past-producing pits at Kinsley, also expanded the area of high-grade gold mineralization and demonstrated the potential for Kinsley to host significant high-grade gold mineralization. Drill hole highlights include:
- 8.53 g/t Au over 36.6 metres in PK091CA, including 29.43 g/t Au over 7.6 metres
- 15.6 g/t Au over 3.0 metres in PK083C
- 2.21 g/t Au over 10.7 metres in PK073
- 1.65 g/t Au over 24.4 metres in PK074
- 2.51 g/t Au over 16.8 meters in PK102
From the south edge of the Western Flank target, mineralization is open and becomes shallower to the south over a distance of 500 meters to the Wrong Spot target, a 350-metre long NNE-trending exposure of surface jasperoids returning 1-3 g/t Au in grab samples.
2012 Exploration by Pilot Gold
Over the course of the 2012 program, 12,000 metres of infill and step-out core & RC drilling were completed to define and expand the mineralized zones identified by previous operators. In conjunction with drilling, a comprehensive regional effort to identify new targets was completed, encompassing both the original 141 claims, as well as 128 claims staked by Pilot Gold to the north in a largely unexplored area. Through this work, a new mineralized zone was intersected in drilling (Candland Canyon) and the Western Flank Zone was expanded to now cover an area 600 metres by 100 metres. Drill highlights from the 2012 program include:
- 6.03 g/t gold over 13.7 metres in hole PK06, including 15.18 g/t gold over 4.6 metres
- 5.48 g/t gold over 20.4 metres in hole PK014C, including 16.43 g/t gold over 5.5 metres
- 2.30 g/t gold over 19.8 metres in hole PK057
A three-dimensional model of geology and mineralization was created in order to aid in the selection of new, high-grade drill targets. Surface soil and rock samples show anomalous pathfinder geochemistry extending seven kilometres to the north of the historic open pits, consistent with the presence of a large mineralized system. A Plan of Operations was submitted to the U.S. Bureau of Land Management to allow for property-wide drilling in 2013 throughout the southern claim block.
2011 Exploration by Pilot Gold
On February 10, 2012, Nevada Sunrise announced the initial results of 2011 drilling by Pilot Gold at Kinsley Mountain, which returned impressive intervals of gold mineralization. Pilot Gold’s first work program included 1,250 metres in 6 holes of diamond drilling designed to confirm mineralization in historical reverse circulation holes near the margins of open pits at the past-producing Kinsley Mountain mine.
Drill highlights from the 2011 program include (full results in table below):
- 5.91 grams per tonne gold over 18.4 metres, including 11.93 grams per tonne gold over 7.8 metres in hole PK-04;
- 6.75 grams per tonne gold over 7.5 metres, including 13.52 grams per tonne gold over 3.2 metres in PK-03;
- 6.23 grams per tonne gold over 8.7 metres, including 12.05 grams per tonne gold over three metres in hole PK-02.
The six holes drilled in 2011 were near-twins of existing holes in two locations, one to the north of the main pit and one located between two satellite pits to the southeast. These initial drill results provided confidence that historical drilling accurately quantified the gold endowment at Kinsley Mountain.
This technical information regarding Kinsley Mountain has been reviewed and approved by John R. Kerr, P.Eng., a Qualified Person for Nevada Sunrise as defined by NI 43-101. As of June 30, 2015 drill composites were calculated using a cut-off of 0.20 g/t. Drill intersections are reported as drilled thicknesses. True widths of the mineralized intervals are interpreted to be between 30-90% of the reported lengths. Drill samples were assayed by ALS Chemex (ISO9001:2000) in Reno, Nevada for gold by fire assay of a 30 gram (1 assay ton) charge with an AA finish, or if over 5.0 g/t were re-assayed and completed with a gravimetric finish. For these samples, the gravimetric data were utilized in calculating gold intersections. For any samples assaying over 0.200 ppm an additional cyanide leach analysis is done where the sample is treated with a 0.25% NACN solution and rolled for an hour. An aliquot of the final leach solution is then centrifuged and analyzed by AAS. QA/QC for all drill samples consists of the insertion and continual monitoring of numerous standards and blanks into the sample stream, and the collection of duplicate samples at random intervals within each batch. Selected holes are also analyzed for a 51 multi-element geochemical suite by ICP-MS.