TORONTO, ON --(Marketwired - April 03, 2017) - NewCastle Gold Ltd. (NCA.TO) (NewCastle Gold or the "Company") is pleased to announce that a preliminary surface drill testing program has been completed over the JSLA backfilled pit at the Castle Mountain gold project (the "Project") located in San Bernardino County, California. This work is part of an initial assessment of the backfill material placed within the formerly mined JSLA open pit and the viability for its use as feed material in a potential Run-of-Mine heap leach program ("the ROM program"). The ROM program provides an opportunity to reprocess large volumes of sub 0.5 g/t material that was previously treated as waste.
Marc Leduc, COO commented: "We are very pleased with the initial findings of the backfill drilling program as it confirms our opinion on the potential of the 'old waste' material as mineralized feed for a ROM heap leach. Armed with this data we intend on examining the merits of operating a modest sized ROM heap leach prior to the full restart of the permitted Castle Mountain Mine. The operational concept of reprocessing the 'old waste' material on a ROM heap leach pad could help benefit the project as we could potentially be back in production earlier. The ROM program provides us with the option of quickly restarting the operation as early as 2018, subject to initial capital financing."
A total of 242 short vertical drill holes were completed in January/February 2017 on approximately 30 metre x 30 metre drill centres across the ~ 29 hectare (72 acre) surface of the pit to depths of up to 10 metres (30 feet). A total of 410 samples were submitted for gold analysis (including 21 QA-QC control samples) and returned an average grade of 0.35 g/t Au. A total of 55% of the assays were above 0.20 g/t Au and the grade increases to 0.54 g/t Au by selecting material above a 0.20 g/t Au cut-off.
The JSLA open pit, mined between 1991 to 1996, was subsequently backfilled with blasted ROM 'waste' material from the Jumbo and Oro Belle open pits, located to the north, as the historical cut-off grade for mining was 0.50 g/t Au based on the prevailing gold prices.
The current surface drilling program is aimed at identifying where to start the pre-stripping of the starting pit. This program confirms that the top 10 metres (30 feet) contain large areas of mineralized material (see Figure 1). It should be noted that the surface drilling program does not extend down into the full depth of the JSLA backfill. The 'old waste' material could potentially be feed for reprocessing in a ROM heap leach.
The JSLA backfill is also being investigated through the current definition program slated to be completed in early April, 2017. The JSLA backfill has already been blasted, and only needs to be transported to the heap leach facility next to the previous heap leach pad and placed using a dump leach method. The Company has performed a review of previous metallurgical test work done on coarse ROM material and estimates the recovery of gold to be in the 50% to 65% range. The company is looking at financing the initial capital for the pre-stripping via straight debt financing, or better alternatives if presented.
All new rotary holes were drilled vertically to average depths of 5.5 to 9.1 metres (18 to 30 feet) using an Atlas Copco FlexiROC D65 down-the-hole ("DTH") drill rig supplied by Ledcor CMI Inc. of Reno, Nevada. No true widths for the intercepted intervals have been calculated due to the lack of geological continuity within the unconsolidated backfill material.
Rotary drill samples were submitted to ALS Minerals in Reno, Nevada for crushing until 70% of the sample is finer than a nominal two millimeters in size. A 250 gram ("g") sub-sample is taken from the crushed material and pulverized until 85% passes a 200 mesh (75 µm) screen (ALS Method PREP-31). A 30 g portion of pulverized material (pulp) is then sampled and subjected to fire assay ("FA") with atomic absorption ("AA") finish (ALS Method AuAA-23). Any gold assays greater than 10 g/t Au are re-analyzed where a 30 g portion is taken from the pulp and assayed by FA with a gravimetric finish (ALS Method Au 30 g FA -- GRAV). All samples that yield greater than 0.2 ppm assay are also analyzed for gold cyanide solubility (ALS Method AuAA-13).
The Company employs an industry-standard QA/QC program consisting of standard pulps, coarse blanks and rig duplicates.
About NewCastle Gold
NewCastle Gold (an augustagroup company) has a 100% interest in the Castle Mountain property in San Bernardino County, California. The Castle Mountain heap leach gold mine produced over one million ounces of gold from 1991 to 2004. The Mine and Reclamation Plan, under which the mine operated, was authorized by the County of San Bernardino as the Lead Agency and remains in effect. Water for the drill programs was accessed from existing patented wells on the Project.
An updated NI 43-101 resource for the project was announced on December 2, 2015 which includes Measured Mineral Resources of 17.4 million tonnes grading 0.86 g/t gold containing 0.48 million gold ounces, Indicated Mineral Resources of 202.5 million tonnes grading 0.57 g/t gold containing 3.71 million gold ounces along with Inferred Mineral Resources of 40.8 million tonnes grading 0.58 g/t gold and containing 0.76 million gold ounces. The Project hosts a disseminated low sulphidation epithermal system. Gold is primarily hosted by late-stage rhyolite volcanic units within zones of silicification and brecciation associated with northeast-southwest trending/southeast dipping fault structures which are interpreted to have developed within a collapsed caldera environment. Eleven gold domains are represented by both steep and shallow-dipping orientations.
Marc Leduc, P. Eng., the Company's Chief Operating Officer, is the designated Qualified Person for this news release within the meaning of NI 43-101. He has reviewed and verified that the technical information contained in this release is accurate and has approved of the written disclosure of the same.
Neither the TSX Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Exchange) accepts responsibility for the adequacy or accuracy of this news release.
This news release contains "forward-looking statements" and "forward-looking information" (collectively, "forward-looking information") within the meaning of applicable Canadian securities legislation. Forward-looking information includes information that relates to, among other things, statements with respect to the Run-of-Mine Program, completion of the drill program at Castle Mountain, the mineral resource expansion at Castle Mountain and the identification of future expansion targets at Castle Mountain. Forward-looking information is not, and cannot be, a guarantee of future results or events.
Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by us at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that we identified and were applied by us in drawing conclusions or making forecasts or projections set out in the forward looking information include, but are not limited to that the Company is able to procure personnel, equipment and supplies required for its exploration and development activities in sufficient quantities and on a timely basis and that actual results will be consistent with management's expectations.
The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, the risks discussed under the heading "Risks" in general to the business of NewCastle in documents filed (or to be filed) with Canadian regulatory authorities. Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. NewCastle does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.