VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan 9, 2013) - Northern Freegold Resources Ltd. (TSX VENTURE:NFR)(NFRGF)(8N6.F) is pleased to announce an updated NI 43-101 mineral resource estimate for the Nucleus deposit at the road accessible Freegold Mountain Project, Yukon.
- Subcroping higher grade zone containing 25.9 million tonnes grading 1.02 g/t gold (851,603 oz gold) has the potential to be exploited in the initial years of a mining operation;
- Grade improvement following 2012 drilling and through stricter resource constraints - at 0.4 g/t AuEq cut-off, gold grade increases approximately 19% over the previous estimate over all resource categories;
- Nucleus deposit mineralization begins at surface and is open to expansion in all directions and at depth;
- Excellent gold metallurgical recoveries of up to 97%;
- Nucleus lies adjacent to the Revenue multi-million ounce gold deposit on an 8 km geophysical anomaly with multiple further exploration targets; and
- First economic study on both the Nucleus and adjacent Revenue deposits well underway - expected to be completed in Q1 2013.
The new resource (at a pit optimized 0.25 g/t AuEq cut-off) contains 71.9 million tonnes grading 0.57 g/t gold, 0.85 g/t silver and 0.06% copper (1.31 million oz gold, 1.97 million oz silver and 89 million pounds copper) in the Indicated category and 60.4 million tonnes grading 0.41 g/t gold, 1.48 g/t silver and 0.04% copper (801,235 oz gold, 2.9 million oz silver and 52 million pounds copper) in the Inferred category as shown in Table 1. A 0.25 g/t AuEq cut-off grade is assumed to be reasonable at recent 3 year running average gold prices and the metal recoveries indicated from metallurgical testwork on Nucleus.
Importantly, within the indicated resource there is a significant zone of higher grade mineralization which contains (at a 0.50 g/t AuEq cut-off) 25.9 million tonnes grading 1.02 g/t gold, 1.11 g/t silver and 0.07% copper (851,603 oz gold, 924,040 oz silver and 38 million pounds copper). This higher grade zone subcrops in the centre of the Nucleus deposit and has the potential to be exploited in the initial years of a mining operation.
"With the addition of 2012''s drill results, we are pleased that we have made substantial progress in identifying a potential starter gold pit at Nucleus. This higher grade portion of the deposit contains two thirds of Nucleus'' indicated resource and averages over 1 g/t Au. Combined with the excellent metallurgical recoveries of gold at Nucleus of up to 97%, this represents a significant positive development for the project. The first economic study is currently underway on the Nucleus gold (with minor silver and copper) deposit and on the adjacent Revenue copper-gold-molybdenum deposit. We expect this initial Preliminary Economic Assessment to be completed in the first quarter of 2013. Both deposits are open in all directions. Nucleus and Revenue already contain 1.3 million Indicated oz and 1.9 million Inferred oz of gold. We believe these deposits form part of a much larger continuous district-scale gold-copper system as evidenced by an 8 kilometre long geophysical anomaly and largely coincidental gold and copper soil anomalies," commented Northern Freegold''s President and CEO, John Burges.
|Table 1: Mineral Resource Estimate for Nucleus Deposit|
|* Gold equivalent (AuEq) for the Nucleus Resource is calculated based upon 3 year running average prices of US$1,455/oz for gold, US$27.55/oz for silver and US$3.65/lb for copper and assumes metallurgical recoveries of 97% for gold, 51% for silver and 43% for copper (Note:total contained AuEq metal values may not add exactly because of rounding).|
|** Mineral resources do not demonstrate economic viability, and there is no certainty that these mineral resources will be converted into mineable reserves once economic considerations are applied.|
Nucleus Zone Resource Estimate
The 2012 updated mineral resource estimate includes results of an additional five diamond drill holes (2,453 metres) from the 2012 drill program. The resource estimate is categorized as Indicated and Inferred as defined by the CIM guidelines for resource reporting. Mineral resources do not demonstrate economic viability, and there is no certainty that these mineral resources will be converted into mineable reserves once economic considerations are applied.
The resource estimate is based on more than 31,000 assay values from 322 drill holes (totaling > 50,000 metres). Assay values were verified against drill logs and assay certificates. Drill hole collar locations and down-hole surveys were checked and verified. The mineral resource was estimated using 1.50 metre composites of the assay values, with "zero" grade inserted into intervals that were not sampled.
Geological models were constructed of the porphyry dykes that control the higher grade mineralization, and shells were constructed of >0.4 g/t AuEq core mineralization and a >0.1 g/t AuEq halo surrounding the core. Composite samples were domained by utilizing the geological and the grade shell models.
Separate estimates were run for Au, Ag, and Cu values for all models. AuEq values were calculated based on recovered metals as indicated in recent metallurgical work (see press release dated September 19, 2012) carried out by SGS Canada Inc. (up to 97% Au recovery, 51% Ag recovery, and 43% Cu recovery). Previous resource estimates on Nucleus in 2010 and 2011 had based AuEq values on 100% recovery of insitu grades of all metals and did not take recovery factors into consideration.
The geological models were used to constrain the composite values chosen for interpolation and the blocks reported in the mineral resource. A block model was constructed using 10 m x 10 m x 5 m blocks in the x, y, and z direction respectively. Grades for gold, copper and silver were interpolated into the blocks by the inverse distance squared method using a minimum of 2 and maximum of 12 composites to generate block grades in the indicated category and a minimum of 1 and maximum of 5 composites, with a maximum of 2 composites per drill hole, to generate block grades in the inferred category. Check validation models were carried out using ID, ID3 and ordinary kriging with very similar results for all models. Kriging was not used to report resource values as satisfactory variograms were not generated, and the differences in modeled results were negligible. The resource block model can be viewed on our website at www.northernfreegold.com on the home page under Features.
The Nucleus deposit mineralization begins at surface and is open to expansion laterally and at depth. The existing resource estimate tests only the upper reaches of a high chargeability and high conductivity zone identified by a Titan 24 survey completed in 2010. This zone extends over an area 1.5 km wide by 1.5 km long at an approximate depth of 100 to 500 m below surface. The Nucleus deposit lies adjacent to the Revenue deposit. The Company published its inaugural NI 43-101 compliant resource estimate for Revenue in early 2012. It is believed that the Revenue deposit, the Nucleus deposit to the west, and the Stoddart Zone to the east are all part of a large scale gold-rich porphyry system, which extends in an east-west direction for more than eight kilometres. Maps depicting this can be viewed on our website (http://www.northernfreegold.com/s/Nucleus.asp).
The Indicated and Inferred mineral resource estimate has been prepared in compliance with the standards of NI 43-101 by A. Sexton, M.Sc., P. Geo., and J. Campbell, B.Sc., P. Geo., of GeoVector Management Inc. GeoVector is an Ottawa, Ontario consulting firm specializing in resource estimation, project assessment and project management. Mr. Joe Campbell acted as the Qualified Person, as defined in NI 43-101 and is independent of the Company. An updated NI 43-101 report will be finalized and filed on SEDAR within 45 days of the date of this news release.
Paul Reynolds, B. Sc. P. Geo., Vice President Exploration for Northern Freegold Resources Ltd., is the Qualified Person, as defined by NI 43-101, for the Freegold Mountain Project and has reviewed the technical information in this release.
An Inferred resource estimate for the Revenue Zone was calculated in January 2012. This mineral resource estimate is based on 54 drill holes (10,582 meters) with 5,997 assay values collected. A range of mineral resources were estimated at various AuEq cut-off grades for the Revenue zone and are presented in the table below.
|Inferred Mineral Resources for the Revenue Deposit|
|* Gold equivalent (AuEq) for the Revenue Resource is calculated based upon prices of US$1,016/oz for gold, US$15.82/oz for silver, US$2.95/lb for copper and US$15.82/lb for molybdenum, and assumes 100% metal recovery with no discount for metallurgical recovery in contained metal figures (Note:total contained AuEq metal values may not add exactly because of rounding).|
|** The resource estimate is categorized as Inferred as defined by the CIM guidelines for resource reporting. Mineral resources do not demonstrate economic viability, and there is no certainty that these mineral resources will be converted into mineable reserves once economic considerations are applied. The Inferred mineral resource estimate has been prepared in compliance with the standards of NI 43-101 by Dr. A. Armitage, P. Geol., and J. Campbell, B.Sc., P. Geo., of GeoVector Management Inc.|
Roads and Power Access
The Freegold Mountain project is located within the Dawson Range and covers an area in excess of 198 square kilometres (75 square miles). The Nucleus Au-Ag-Cu deposit and the Revenue Cu-Au-Mo deposit cover approximately 30 square kilometres. The project has significant infrastructure advantages. It is located approximately 200 kilometres northwest of Yukon''s capital and industrial center in Whitehorse. It is road accessible from Whitehorse, along the main Klondike Highway, a paved all-weather highway running from Whitehorse to Dawson City thence along a 70 kilometre government maintained road from Carmacks, called the Freegold Road. This road currently terminates near the Company''s Revenue camp thus giving the Company full road access. Western Copper and Gold Corporation, recently released its feasibility study (January 7, 2013) on the large Casino copper-gold property, which lies a further 132 kilometres to the west. They propose extending the Freegold Road through Northern Freegold''s property generally following the alignment of the "Casino Trail". Commercial electrical grid power is available at Carmacks. The publicly owned Yukon electricity utility, the Yukon Energy Company, recently built a new 138kv high voltage transmission line along the Klondike Highway from Carmacks to Stewart Crossing linking the north and south electricity grids. The utility also built a spur electrical line extending into the Minto copper mine 30 kilometres north of the Freegold Mountain project.
About Northern Freegold
Northern Freegold Resources Ltd. (TSX VENTURE:NFR)(NFRGF) trades in Canada on the TSX Venture Exchange under the symbol "NFR" and in the United States on the OTCQX under the symbol "NFRGF". Northern Freegold is a growth oriented Canadian-based precious metals exploration and development company. Northern Freegold is focused on creating value through the advancement of the district-scale Freegold Mountain project, which hosts one of the largest undeveloped gold and copper resources in the Yukon.
For maps and more information, please visit our website www.northernfreegold.com
On behalf of the Board of Directors
John Burges, President and CEO
Cautionary Note Regarding Forward-Looking Statements - The information in this press release includes certain "forward-looking statements". All statements, other than statements of historical fact, included herein including, without limitation, plans for and intentions with respect to the company''s properties, strategic alternatives, quantity of resources or reserves, timing of permitting, construction and production and other milestones, are forward looking statements. Statements concerning Mineral Reserves and Mineral Resources are also forward-looking statements in that they reflect an assessment, based on certain assumptions, of the mineralization that would be encountered and mining results if the project were developed and mined in the manner described. Forward-looking statements involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from NFR''s expectations include the uncertainties involving the need for additional financing to explore and develop properties and availability of financing in the debt and capital markets; uncertainties involved in the interpretation of drilling results and geological testing and the estimation of reserves and resources; the need for cooperation of government agencies and First Nations groups in the exploration, and development of properties; and the need to obtain permits and governmental approval. NFR''s forward looking statements reflect the beliefs, opinions and projections of management on the date the statements are made. NFR assumes no obligation to update the forward looking statements if management''s beliefs, opinions, projections, or other factors should change.