Mr. Tim Termuende reports
EAGLE PLAINS PROVIDES UPDATE ON FISHER GOLD PROJECT, SASKATCHEWAN
Eagle Plains Resources Ltd. has recently received a $75,000 cash payment from option partner SSR Mining Inc. (formerly Silver Standard Resources Inc.), indicating that SSR Mining wishes to proceed into the second year of a four-year option agreement, whereby SSR Mining may earn up to an 80-per-cent interest in the 34,000-hectare Fisher property by completing $4-million in exploration expenditures and making $3.3-million in cash payments to Eagle Plains (see details herein). The Fisher project is contiguous to the north, south and east with SSR Mining's Seabee gold operation. SSR Mining has advised Eagle Plains that surface activities have been completed and preparations are being made for a winter drilling campaign.
Surface exploration activity in 2017 consisted of till sampling, soil geochemical sampling, geological mapping and prospecting. Results were encouraging, with numerous areas of elevated gold in soils documented within Fisher property boundaries. A cluster of elevated-gold-in-soil anomalies correlate to areas of high strain and shearing, significant alteration and quartz veining that were identified during mapping. The anomalies also coincide with a bifurcation of the Santoy shear zone, with anomalous values following both branches of the structure. Despite poor exposure, the trend has been traced in outcrop over a strike length of 1.5 kilometres to 2.0 kilometres. Full details of the surface exploration work are expected to be released as they are obtained by Eagle Plains.
The 2017 exploration program targeted a mineral resource discovery on the Fisher property. To achieve this objective, the SSR Mining exploration team focused on improving and refining the geological and structural framework of the Fisher property, further evaluating and testing historical mineral occurrences and identifying additional mineralization in setting similar to that currently being mined at the Seabee gold operation.
As reported in the Eagle Plains news release dated Aug. 29, 2017, forest fire activity in the area did not significantly affect survey activity. Subsequent to that news release, fire activity resumed in the Fisher camp area, resulting in the loss of some equipment and structures. An unmanned-aerial-vehicle-borne detailed aeromagnetic survey is planned for the fourth quarter of 2017 followed by drilling activity in the first quarter of 2018.
The Seabee gold operation has been in continuous production since 1991 and has produced approximately 1.2 million ounces of gold from the Seabee and Santoy deposits. As reported by SSR Mining in its news release dated Sept. 7, 2017, as at Dec. 31, 2016, the Seabee gold operation includes the following estimated mineral reserves and mineral resources: proven and probable reserves of 1.37 million tonnes at an average gold grade of 8.19 grams per tonne gold; measured and indicated resources (inclusive of mineral reserves) of 2.07 million tonnes at an average grade of 8.02 grams per tonne gold; and inferred resources of 2.50 million tonnes at a grade of 7.66 grams per tonne gold. SSR Mining earlier reported uncut drill intercepts grading up to 1,004 grams per tonne gold over 1.6 metres, including 3,887 grams per tonne gold over 0.4 metre (true width) at its Santoy Gap deposit, located approximately three kilometres northwest of the Fisher property boundary (see SSR Mining news release dated May 1, 2017). Management cautions that past results or discoveries on proximate land are not necessarily indicative of the results that may be achieved on the subject properties.
Ore geology at the Seabee gold operation consists of high-grade vein mineralization associated with shear zones that transect mafic meta-volcanic and intrusive rocks, as well as granitic rocks emplaced during the regional deformation events impacting the Pine Lake greenstone belt during the Proterozoic. The Seabee gold operation and the Fisher project occur within the Pine Lake greenstone belt. Mineralization at the Seabee gold operation occurs at the Seabee and Santoy mines, which are located approximately 14 kilometres apart. The former is affiliated with the more westerly oriented Laonil Lake shear zone, while the latter is hosted on a regional north-trending shear zone that has been traced over much of the Fisher property. Field and underground observations at the Seabee gold operation suggest that shear structures nucleated at contacts between granodiorite and meta-volcanic lithologies, with high-grade zones forming at minor flexures.
Details of the Fisher option agreement
To earn a 60-per-cent interest over four years, SSR Mining paid $100,000 to Eagle Plains on signing of the formal agreement and has agreed to complete $4-million in exploration expenditures and make annual cash payments of $75,000 for each of the four years of the option period. SSR Mining has now made the first annual cash payment of $75,000 and financed the $400,000 exploration program completed by Eagle Plains in 2016 (see news releases dated July 18, 2016, and Sept. 12, 2016), which is included in the $4-million exploration expenditures. Once the 60-per-cent earn-in has been completed, SSR Mining has a 90-day, one-time option to earn an additional 20-per-cent interest (for a total of 80 per cent) by making a cash payment of $3-million to Eagle Plains, at which time an 80-per-cent/20-per-cent joint venture will be formed to further advance the property. Eagle Plains will retain a 2.5-per-cent net smelter return, subject to reduction on certain claims by underlying net smelter return agreements. Eagle Plains' net smelter return may be reduced by 1 per cent at any time upon payment of $1-million by the joint venture. In addition, Eagle Plains will receive advance royalty payments of $100,000 annually from the joint venture until commencement of commercial production.
About Eagle Plains Resources
Based in Cranbrook, B.C., Eagle Plains continues to conduct research on, acquire and explore mineral projects throughout Western Canada. Since 2012, Eagle Plains has added to its portfolio a number of new projects exceeding 130,000 hectares targeting mainly gold, uranium and base metals in Saskatchewan.
Expenditures from 2011 to 2016 on Eagle Plains-related projects were approximately $16-million; these expenditures were financed by Eagle Plains and, for the most part, by third party partners. This exploration work resulted in approximately 15,000 metres of diamond drilling and extensive ground-based exploration work, facilitating the advancement of numerous projects at various stages of development.
Technical aspects of this news release have been reviewed and approved by Jarrod Brown, PGeo.
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