U.S. Markets open in 1 hr

Klondike Gold Drills 2.4 g/t Au Over 40.9 Meters and 2.1 g/t Au Over 41.1 Meters

VANCOUVER, BC / ACCESSWIRE / July 11, 2017 / Klondike Gold Corp. (TSX-V: KG; FRA: LBDP) ("Klondike Gold" or the "Company") has received drill assay results from the first two holes of eighteen drilled so far at the Lone Star target within the Company's Klondike district property, Yukon Territory.

SUMMARY

  • At the Lone Star target, LS17-81 assayed 2.1 g/t Au over 41.1 meters from surface, a new 50 meter step-out to the west of LS16-58 drilled in 2016 which assayed 2.4 g/t Au over 37.0 meters.
  • LS17-82 assayed 2.4 g/t Au over 40.9 meters from 10 meters downhole, a direct 25 meter undercut of LS16-58.
  • The Lone Star target strike length is now 750 meters and remains open to east, west and down-dip. Assays from a further twelve holes at Lone Star, and four from other targets, are pending from Phase 1 drilling.
  • The Phase 1 drill program tested a 1,950 meter strike length along the Bonanza Fault including the 750 meter Lone Star target segment. Seven holes of Phase 1 contain visible gold identified as disseminations and in quartz veining spanning the 1,950 meter strike length tested.
  • The Phase 2 drill program has commenced today and is expected to comprise another approximately 20 holes with the primary objective to continue to expand the Lone Star mineralized target to the west and to depth.

Eighteen diamond drill holes in the 2017 Phase 1 drill program ("Phase 1") tested a 1,950 meter strike length along or adjacent to the newly identified Bonanza Fault, from the new Pioneer area in the east, to the central Lone Star target zone of interest, to the new O'Neill area in the west. The Bonanza Fault is interpreted to be a significant locus for orogenic gold mineralization with an inferred 7,500 meter potential strike length.

Seven holes of Phase 1 contain visible gold identified as disseminations and in quartz veining spanning the 1,950 meter strike length tested along the Bonanza Fault. These include five holes testing the Lone Star target out of fourteen, and one hole out two which tested each of the Pioneer and O'Neill areas. A plan map of Phase 1 drill locations is available on our website HERE.

Fourteen holes of Phase 1 tested the Lone Star target with assays received for the first two. LS17-82 intersected 2.4 g/t Au over 40.88 meters from 10 meters downhole. LS17-82 is a direct undercut of LS16-58, the best hole of 2016 at Lone Star, which assayed 2.4 g/t Au over 37.0 meters. Both LS17-82 and LS16-58 had small amounts of visible gold identified. LS17-81, a new 50 meter step-out to the west of LS16-58, intersected 2.1 g/t Au over 41.12 meters from surface. LS17-81 also had small amounts of visible gold identified. The Lone Star target strike length is now 750 meters and remains open. Phase 1 drilling primarily tested the Lone Star target at near-surface depths on 50 meter spacing. Assays for the remaining twelve of these holes are pending.

Two step-out holes at the O'Neill area intersected pyritic schist 700 meters away along strike to the west of the Lone Star target. Visible gold is observed in this schist unit in one of two holes. In addition, two step-out holes at the Pioneer area 500 meters away along strike to the east intersected a competent unaltered 'mafic schist' unit cross-cut by visible gold-bearing quartz veinlets adjacent the Bonanza Fault. The style of mineralization and host lithology here has similarities to the Company's Nugget Zone prospect (see NR September 28, 2016). Sampling of these holes is underway; all assays are pending. Further geophysics, drill testing and mapping is planned to potentially link the Lone Star target zone with the Pioneer and O'Neill areas.

Investors are cautioned that the observation of visible gold in drill core is not certain indication that assaying will show economically interesting quantities. Visible gold is common in the Company's Klondike project area and in particular along the Bonanza Fault. The Klondike district creeks are known for producing 20 million ounces of visible gold as specks, grains, and nuggets mined from creek gravels derived from nearby bedrock sources by erosion.

At the Lone Star target, gold occurs within a recently defined pyritic "laminated schist" field unit as disseminations as well as in quartz veinlets that is the prospective gold mineralized target horizon. This unit is associated with a major second-order "D4" high-angle fault termed the "Bonanza Fault" which is variably silicified, carbonate altered, and mineralized with pyrite. Visible gold associated with the Bonanza Fault has been identified in drill core over a length of 1,950 meters.

Work is focusing on advancing the multi-kilometer long Lone Star exploration target, the first significant sizeable gold-bearing bulk-tonnage type target area outlined within the district. More broadly across the district, the working geologic model is generating other quality targets that are taking shape throughout the Company's expanded claim holdings (see NR August 8, 2016).

The Company's Phase 2 drill program has commenced. The program is expected to comprise another approximately 20 drill holes with the objective of extending the Lone Star mineralized target to the west on 50-meter step outs and to complete a number of deeper undercuts to test continuity to depth.

The technical and scientific information contained within this news release has been reviewed and approved by Peter Tallman, P.Geo, President of Klondike Gold Corp. and Qualified Person as defined by National Instrument 43-101 policy.

ABOUT KLONDIKE GOLD CORP.

Klondike Gold Corp. is a Canadian exploration company with offices in Vancouver, British Columbia, and Dawson City, Yukon Territory. The Company is focused on exploration and development of its Yukon gold projects, accessible by government maintained roads located on the outskirts of Dawson City, YT, covering a district-scale 527 square kilometers of hard rock and 20 square kilometers of placer claims including "McKinnon Creek" featured on the Discovery Channel show "Gold Rush".

On behalf of Klondike Gold Corp.

"Peter Tallman"

President and CEO
(604) 609-6110
E-mail: info@klondikegoldcorp.com
Website: www.klondikegoldcorp.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Disclaimer for Forward-Looking Information

"This press release contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities laws. This information and statements address future activities, events, plans, developments and projections. All statements, other than statements of historical fact, constitute forward-looking statements or forward-looking information. Such forward-looking information and statements are frequently identified by words such as "may," "will," "should," "anticipate," "plan," "expect," "believe," "estimate," "intend," and similar terminology, and reflect assumptions, estimates, opinions, and analysis made by management of Klondike in light of its experience, current conditions, expectations of future developments and other factors which it believes to be reasonable and relevant. Forward-looking information and statements involve known and unknown risks and uncertainties that may cause Klondike's actual results, performance, and achievements to differ materially from those expressed or implied by the forward-looking information and statements and accordingly, undue reliance should not be placed thereon.

Risks and uncertainties that may cause actual results to vary include but are not limited to the availability of financing; fluctuations in commodity prices; changes to and compliance with applicable laws and regulations, including environmental laws and obtaining requisite permits; political, economic and other risks; as well as other risks and uncertainties which are more fully described in our annual and quarterly Management's Discussion and Analysis and in other filings made by us with Canadian securities regulatory authorities and available at www.sedar.com. Klondike disclaims any obligation to update or revise any forward-looking information or statements except as may be required.

SOURCE: Klondike Gold Corp.