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Figure 1.
Subject Company's Logo
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AM Gold Inc.
(TSX-V:
AMG)
AM Gold Inc. is a
Canadian-based mineral exploration mining company listed on the TSX Venture
Exchange (ticker symbol AMG) (US Listing: ACERF.PK) (Frankfurt: AMX). The
Company has come to our attention due, in part, to the exceptional
opportunity afforded shareholders within AM Gold's Pinaya
gold-copper deposit in Peru, and Red Mountain gold project within the Tintina Gold Belt, Yukon.
AM Gold now has sizeable
resource estimates on two fronts with strong growth prospects, making AMG.V
an undervalued and exceptional risk-reward scenario. The risk-reward characteristics are
highly advantageous for investors establishing a long position in AMG.V as the current in-situ gold
equivalent resource valuation is one of the most undervalued in the industry and
AM Gold will be executing a plan to build its resource on each front.
Each project offers major new discovery potential and all are located in mining friendly
jurisdictions. Mining Marketwatch
Journal provides insight into each of these below:
#1)
Pinaya gold-copper deposit, Peru -
contains a new updated NI 43-101 resource estimate of 152,000 oz Gold
Measured + 464,000 oz Gold Indicated + 353,000 oz Gold Inferred &
57,991,000 lbs Copper Measured + 234,778,000 lbs Copper Indicated +
318,171,000 lbs Copper Inferred. Pinaya possesses very large bulk
tonnage potential similar to Goldfields 5.6M oz gold equivalent
Chucapaca only 80km away on same trend.
#2)
Red
Mountain within Tintina Gold Belt, Yukon Canada - In Q4 2010
AM Gold released an updated NI 43-101 resource estimate on Red Mountain
of 1,230,000 ounces gold inferred. The project is located
29km west of
Victoria Gold's Dublin Gulch which hosts 6.3M oz gold, in the same geological belt as Underworld
and Keno Hill.
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1)
Pinaya Gold-Copper Project,
Peru
- 100% owned
Figure 11. Location Map (above)
Pinaya is
~80km
from Gold Fields' Chucapaca
Note:
At ~19,200 hectares AM Gold's Pinaya is
an extremely large land package; to date
AM Gold has only explored less ~1% of Pinaya.
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Figure 12. Gold Fields' Chucapaca Grades
Click to enlarge |
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Figure 13. Comparative
Image Chucapaca & Pinaya
Click to enlarge |
Similarities of Pinaya with
Nearby Chucapaca
Goldfields new 5.6M oz Gold
equivalent Chucapaca discovery is located ~80km south south-east of
AM Gold’s Pinaya deposit, it is a very similar deposit with
copper and gold, similar in altitude as they are at 4800 metres
and Pinaya is at 4,200 – 4,400m on the same trend, on the
same mountain range, in the same district. In comparing the
images of both properties Pinaya has similar landscape -- rolling
hills with flat grazing lands. At a press conference on Tuesday
May 11, 2010 Nicholas Holland, Chief Executive for Gold Fields
Ltd. described the Chucapaca discovery; "This
is probably the most significant discovery in South America over
the last few years .... we think this could get a lot bigger."
Holland said that although the published figure is for resources
of about 5.6 million ounces of gold equivalent, "We
believe that there is a lot more here than 5.6 million ounces
[equivalent]." "There is
potential for an underground operation together with an open pit
operation. By next year we should be able to get to completion
of a pre-feasibility study with certain elements taken to
feasibility level," he added. He said any mine there
should be "very competitive" on a price basis.
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Figure
14. 3D View of AMG.V Pinaya
Geomodel
Click to enlarge
This model image is of the
old resource. |
Pinaya Deposit & The Potential
The 3D geological model, seen to the left,
portrays the deposit at AM Gold's Pinaya gold-copper project -- the
image portrays the old resource, a new updated resource was released on
June 6, 2011 of 150,000 oz Gold Measured + 464,000 oz Gold Indicated +
353,000 oz Gold Inferred & 57,991,000 lbs Copper Measured + 234,778,000
lbs Copper Indicated + 318,171,000 lbs Copper Inferred. The new resource
was based on 151 holes (out of 160 drilled on the property) -- a couple of the
last holes drilled were drilled to greater depth (~800+m) than earlier holes and
were still in mineralization as they went down at depth. One satellite
drill hole was drilled in the last round of drilling and intercepted
values to depth. A great number of satellite IP targets and geochemistry
targets are yet to be tested. Since acquiring the project AM Gold has
invested ~US$12M in exploration to derive the results to date. Pinaya is
a large property totalling an area of ~19,400 hectares ripe with
untested potential.
The Pinaya property was acquired by AM
Gold between 2004-2006 for 2.5M USD (4M CAD) after completing a search for a very large bulk tonnage
gold-copper situation in the porphyry belts of Peru. The Pinaya property
was identified, acquired (purchased from the local community for US$3M over 3
years), and expanded based on an old gold pit area that was being mined
by a few dozen artisanal miners that were making a living off the gold
outcropping on the surface.
Figure 15.
Map of Gold Skarn Zone & Western
Porphyry:
Click to enlarge
Figure 16. Pinaya Project
Assay Results (notable intercepts):
 |
Figure 17. Cross Section showing the
2006 gold
resource areas at Pinaya (above) The image above shows histograms
charted on drill holes. Yellow areas on right are higher grade zones of
mineralization of gold, gold is on bottom, copper on top. The dip at the
top on the landscape green line is the current hand-mined pit area. The
area in blue was defined enough to be included in the resource however
the zoned
area at the bottom was not defined enough.
AM Gold's
2011 Exploration Program at Pinaya
(See related February 7, 2011 release
entitled "AM
Gold's 2011 Exploration Program at Pinaya")
Diamond drilling is scheduled to commence
at the resource area in Q2 2011. An aggressive exploration program
has been planned for 2011 at Pinaya which will focus on resumption of
drilling operations within the resource area as well as the exploration
of encouraging porphyry-related targets at the south end of the
property. These new targets were recently identified during a three-week
field reconnaissance program undertaken in Q1 and Q2, 2011.
Additional target drilling based on results of the soils sampling and
geophysical programs south of the resource area could begin as early as
Q2 2011. A total of up to 8,000 meters of drilling is planned for the
year pending results of preliminary target evaluation programs at the
southern end of the property.
Also see related March 24, 2011 release
regarding geophysics entitled "AM
Gold Announces Airborne Geophysical Survey at Pinaya and Minas Lucho
Properties and Changes to the Board of Directors".
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Figure 18. AMG.V Drilling at Pinaya. |
Salient project insight
Figure 19. AMG.V main core shed, kitchen, living, health
complex at Pinaya
Infrastructure
AM Gold possesses quality
infrastructure at Pinaya including a core shed facility, a camp, and
kitchen facility for operation of the project. Access is extremely good, water is
on the property, power is a very short
distance to the west (~7km) and may be connected at nominal cost.
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Property Location Map
Click To Enlarge Image |
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Property Access Map
Click To Enlarge Image |
Location/size/100% AM Gold
ownership
The Pinaya Gold-Copper Project
is located approximately 775
kilometers southeast of Lima,
the capital of Peru, and 110
kilometers north-northeast of
Arequipa, the second largest
city in Peru. The property area
is comprised of mineral
concessions totalling over
19,200 hectares.
Access to the property is
excellent, proceeding
northeastwardly from the city of
Arequipa, via paved Peruvian
Highway Number 30B, for 142
kilometers to the Tintaya Copper
Mine access road, and then
northward on a well-maintained
gravel road for 22 kilometers to
the small community of Occopaica.
At Occopaica, a gravel access
road leads 7 kilometers
eastwardly to the property.
Arequipa international airport
has daily flights to and from
Lima. A nearby airstrip capable
of accepting small jets is
located at the Tintaya mine
approximately 100 kilometres
north of Pinaya.
100% Ownership; 100%
owned by AM Gold's subsidiary
with no underlying NSR, AM Gold's 100% owned
operating company in Peru.
Mining MarketWatch Journal has
researched and confirmed AM Gold
has no long term debt and no
issues surrounding debt or
creditors since restructuring.
Peru is unanimously
agreed in the mining community
to be a stable, mining friendly
region. Ranking within the
Fraser Institute's Annual Survey
of Mining Companies released
this March 2011 may be viewed
here. The mining claim and permitting process in Peru is highly transparent
and clearly laid out. |
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Regional
Geology
Click To Enlarge Image |
Regional Geology
Regionally, Pinaya is located
within the southeastern end of
the emerging Andahuaylas-Yauri
metallogenic belt which hosts
the Tintaya Mine (Xstrata PLC),
the Las Chancas deposit
(Southern Peru Copper
Corporation), the Las Bambas
deposit (Xstrata PLC), as well
as numerous other
copper-gold-molybdenum porphyry
and skarn occurrences. The
Tintaya Mine, one of the largest
copper producers in Peru, and
situated 100 km north of the
Pinaya Project, was recently
purchased by Xstrata from BHP
Billiton for US$750 million.
Most of the stratigraphy,
structure, magmatism, volcanism
and mineralization in Peru is
spatially- and
genetically-related to the
tectonic evolution of the Andean
Cordillera which is situated
along a major convergent
subduction zone where the
oceanic crust, the Nazca Plate,
slips beneath the overriding
South American continental
plate. The Andean Cordillera has
a metamorphic rock basement of
Proterozoic age on which
Hercynian Paleozoic sedimentary
rocks accumulated and were in
turn deformed by plutonism and
volcanism to Upper Paleozoic
time. Beginning in the Late
Triassic time, following
Atlantic Ocean rifting, two
periods of subduction along the
western margins of South America
have resulted in the formation
of the present Andes; the
Mariana-type subduction from the
Late Triassic to Late Cretaceous
and Andean-style subduction from
the Late Cretaceous to the
present.
Peru can be divided into
physiographic regions which
correspond to tectonic elements
of the Andean Cordillera. In
southern Peru there are, from
west to east, the Coastal Belt,
Western Cordillera, Altiplano,
Eastern Cordillera, and
sub-Andean zones. Heterogeneous
Precambrian basement lithologies,
underlying the Coastal Belt and
comprising part of the Western
Cordillera in southern Peru, are
called the ‘Arequipa Massif’.
The northern extent of the
Precambrian basement corresponds
to the termination of the
Altiplano and the start of the
Nazca Ridge. There is an
intervening northeasterly
trending tectonic element,
called the ‘Arica’ deflection or
‘Bolivian Orocline’, that is
underlain by basement
lithologies where the Andes
widen and bend easterly.
Late Triassic to Late Cretaceous
Mariana-type subduction resulted
in an environment of extension
and crustal attenuation
producing an oceanic trench,
island arcs, and back arc basin
from west to east. The back arc
basin reportedly has two basinal
components, the Western Basin
and Eastern Basin, which are
separated by the Cusco – Puno
high, probably part of the
Maranon Arch. The basins are
largely comprised of marine
clastic and minor carbonate
lithologies of the Yura and Mara
Groups overlain by carbonates of
the Ferrobamba Formation. The
western back-arc basin, called
the ‘Arequipa Basin’, is the
present Western Andean
Cordillera of Peru; the site of
a Holocene magmatic belt that
spans the Andes and was emplaced
from Late Oligocene to 25 Ma.
The Western Andean Cordillera is
famous for its world-class base-
and precious-metal deposits;
many of which have been
intermittently mined since Incan
time. Most of the metal deposits
in Peru are spatially and
genetically associated with
metal-rich hydrothermal fluids
generated along magmatic belts
that were emplaced along
convergent plate tectonic
lineaments. Furthermore, many of
these primary base-metal
deposits have undergone
significant secondary enrichment
over the last 30 Ma as a result
of periodic continental uplift
and leaching followed by
volcanic cover preservation.
Radiometric studies have
correlated the igneous host
rocks and attendant hydrothermal
alteration for some of the
largest and richest porphyry
copper deposits in the world
along the Western Andean
Cordillera from 6 degrees to 32
degrees south, including the
Chalcobamba – Tintaya
iron-gold-copper skarn and
porphyry belt (30-35 Ma) in the
main magmatic arc, southward
through the Santa Lucia district
(25-30 Ma) and into Chile. The
Andahuaylas-Yauri Porphyry
Copper Belt, a well known
300-kilometre long porphyry
copper belt related to middle
Eocene to early Oligocene
calc-alkaline plutonism, is
situated along the northeastern
edge of the Western Andean
Cordillera. The Pinaya property
is situated near the
south-southeastern end of this
belt.
Property Geology
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Location
of Mineralized Zones on Claim Map
Click To Enlarge Image |
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Structural
Interpretation
Click To Enlarge Image |
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Property
Geology
Click To Enlarge Image |
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Soil
Geochemistry
Gold
Values
Click To Enlarge Image |
|
Soil
Geochemistry
Copper
Values
Click To Enlarge Image |
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Pinaya Resource
Technical Report Oct 2006
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Initial NI 43-101 Resource
Estimate
Pinaya can be characterized as a porphyry
copper-gold, gold-copper skarn-epithermal, and supergene copper deposit.
The deposit is developed in Lower Tertiary Puno Group sediments, which
have been intruded and mineralized by Mid-Eocene to Oligocene dioritic
intrusive bodies thought to be related to the Incaic Orogeny and the
coeval tectonomagmatic emplacement of the Andahuaulas-Yauri Batholith.
Copper mineralization on the property is both hypogene and supergene in
character. Structurally controlled mineralization is present in the form
of narrow skarn zones and local narrow high grade gold and silver veins
on different parts of the property.
Shallow marine and continental clastic
sediments with intercalated volcanic sediments, belonging to the late
Cretaceous to early Tertiary Puno Group, dominate the Pinaya Project
area. The package of rocks can reach a thickness of 800 metres. It has
been intruded by stocks of dioritic and monzonitic composition and it is
overlain by the Tertiary volcanic Tacaza Group. The dominant structural
feature, the Lagunillas Fault Zone (the “LFZ”) appears to have
controlled the local deposition of continental clastic sediments.
The Pinaya mineralized deposits may be
characterized as being of the porphyry copper gold skarn and supergene
types. They are described as typical of a porphyry environment and
similar to some of those found in other parts of southeastern Peru and
in northern Chile. They appear to be spatially related to a series of
prominent, northwestsoutheast trending faults and shear zones, and
genetically associated with metal-bearing hydrothermal fluids related to
the emplacement of alkaline intrusions and their associated alteration
zones. The structures might be tectonically related to either the LFZ or
a similarly orientated, subsidiary fault. The copper-gold tenor with the
mineralized centres varies according to the associated intrusive phase,
structural complexities and alteration overprints.
The mineral deposits occur in five main zones: the Gold Oxide Skarn
Zone; the Pinaya Intrusive Complex (that includes the Northwestern
Porphyry, Western Porphyry and Vizcachani Zones), the Montańa de Cobre y
Oro Zone, the Pedro Dos Mil Mineralized Complex (that includes the Minas
Jorge and Pedro 2000 mineralized occurrences that might be structurally
linked with the Montańa de Cobre y Oro Zone) and the Saitocco Zone. The
Zones may be classified into three main types: copper-gold deposits
associated with karn zones (mainly the Gold Oxide Skarn Zone); classic
porphyry copper-gold deposits; and copper-gold deposits in sheared and
oxidized country rocks (mainly in the area of the Montańa de Cobre y Oro
Zone).
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Figure
33. Hand dug workings at Pinaya |
Figure
34. Drill Core Warehouse |
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Fig. 35. The
grazing economy |
Community Relations and Surface Rights
AM Gold has acquired surface rights on key
concessions. Surface access is encouraged as the land Pinaya occupies is
uninhabited upland grass terrain at high altitude where all of the
surface area is owned by the local grazers and people that work in the
local villages. AM Gold purchased the mineral rights in 2004 from the
township and the entire community owned all of the surface rights. AM
Gold has acquired key surface rights around the gold pit area. The area
is essentially a grazing economy and jobs in a mine would be very
welcome so the communities are all positively inclined towards a mine.
There is no relocation of houses as most of the people live in the
villages and the grazing is done out all over the land which is open and
unfenced and the shepherds go along with the animals, so it is not a
matter of relocating somebody’s homestead, it’s a matter of relocating
grazing or penning off the work area to keep the free range llamas and
alpacas out. AM Gold has good community relations; assisting in the
building a new school, purchasing new breeding animals for local
farmers, and providing employment to locals. |
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2)
Red Mountain gold project, Yukon
- 100% Ownership, 0.5% NSR
Quality Gold Intercepts and Growing
Ounces -- 1,230,000 Troy Ounces Inferred Gold Resource
Estimate
NOTE: Mineralization now (as of
November 2011) ~1km along strike & 500m across
The following information [below] was
prepared prior to the 2011 Summer drill program. AM Gold Inc. released
news on September 12, 2011 regarding preliminary results of the 2011
drill program entitled "AM
Gold Extends Mineralization 200 Meters East and Confirms New Gold Zone
at Red Mountain", October 3, 2011 release entitled "AM
Gold Expands Gold Mineralization to Extend Across 450m Width Including
Jethro Structure at Red Mountain", November 21, 2011 release
entitled "AM
Gold Intercepts 60.9 metres at 1.06 g/t Gold at Surface Included Within
233.6 metres at 0.57 g/t Gold and Extends Mineralization to at Least
500m Wide and 900m in Length".;
In short, drill hole results from summer the 2011
exploration revealed a series of successful intercepts that have
significantly extended mineralization, now ~1km along strike & 500m
across (including the inferred resource estimate). This
affirms the belief geologists have that Red Mountain is a deposit of
significance with potential to rival the biggest area reference Fort
Knox.
Geophysical
Interpretation
"The
geophysical interpretation is that there is a very large intrusive which
is just peeking through the top of Red Mountain and comprises the centre
of the mountain. The potential is that the whole mountain is prospective
and AMG, although already at 1,230,000 ounces
inferred gold resource estimate, is just starting to drill into it."
-- Source: Market Equities Research Group
|
Figure 2. Tintina Gold
Belt |
AM Gold’s updated resource of 1,230,000 troy ounces gold appears to represent
just the very tip of the iceberg at
Red Mountain
The new updated resource estimate
on AM Gold's Red
Mountain gold project, Yukon (See related December 2, 2010 release entitled
"AM
Gold Announces Updated [1.23] Million Troy Ounce Gold Inferred Resource
Estimate for Red Mountain Property") dramatically increases the intrinsic value of
AMG.V and further documents the Company’s presence and potential in the Tintina
Gold Belt. The Red Mountain gold project appears to possess strikingly
similar characteristics to other success stories in the area and has the potential
to rival Kinross’s Fort Knox deposit. Exploration is now aimed at
stepping out and building on what is now understood to be the tip of a
very large intrusive which peeks through the top of Red Mountain.
AM Gold's Red Mountain possesses very large resource
growth potential with possibility to rival Kinross's
Fort Knox mine
-- See target area size in the two images below relative
to the current resource area (identified as the oblong
pink circle); the published resource constitutes a very
small percentage of that target area....
Figure 3. Interpretation Map
(above); Drilling Within Intrusive Target of Tombstone
Monzonite
Figure
4. Red Mountain IP Target (Above)
The target area seen in
figures 3 & 4 (above) is defined by geology and geophysics
-- shown in the figures above is a very large target
area basically designating intrusive, the altered
intrusive, and the published resource area to date. The
striking thing is that
the published
resource constitutes a very small percentage of that target area.
So even being generous saying its 5% of the target area
we get 20 times the area that needs to be explored yet
-- if AM Gold continues to hit this is going to be
enormous. Investors can look forward to a large number
if results continue on with the thicknesses and grade as
it appears is happening now; the results announced to
date basically reaffirm the grade on the 43-101 resource that was published –
AM Gold's geologist and Director, Dr. Stewart Jackson, P.Geol. put matters in simple terms
when we contacted him last season as initial
results were coming in saying
“the mineralization is going
‘deeper, wider, longer and is open in all directions'.”
The last (12th out of 12 holes drilled) drill hole from
the summer 2010 exploration efforts on Red Mountain was
drilled further out from the other 11 to demonstrate the
confidence geologists have that the large intrusion is
indeed that -- it intercepted well; See related November
30, 2010 "AM
Gold expands zone of known gold mineralization
approximately 270 m northeast of ICE10028 at Red
Mountain".
The amount of gold AM Gold is amassing in the Yukon is
astounding and the project now has the earmark of a
world class gold deposit in the making with the
potential to rival biggest area reference Fort Knox
(Kinross - currently producing open pit at average grade
of 0.45g/t with only a modest cost of production) -- AM
Gold’s target objective from a comparative exploration
viewpoint is 10M oz plus.
Current
Resource
Figure 5. Current Resource area
(above)
established in December 2010.
The following are excerpts of the December 2, 2010 release entitled "AM
Gold Announces Updated [1.23] Million Troy Ounce Gold Inferred Resource
Estimate for Red Mountain Property" regarding the publication of the
current resource estimate (figures in "[ ]" are updates since to better reflect
a higher
cut-off);
AM Gold Inc. (TSX
VENTURE:AMG)(FRANKFURT:AMX)
is pleased to announce that
an updated National
Instrument 43-101 report
("the Report") has been
prepared for the Company by
Brian Leslie Cole, P. Geo.,
who is a Qualified Person
under National Instrument
43-101. The Report
includes an updated inferred
resource estimate of [68]
million tonnes grading [0.56]
g/t gold, approximately [1.23]
million contained troy
ounces of gold for the Red
Mountain Property, Yukon
Territory, Canada.
The updated inferred
resource estimate for the
Red Mountain Property has
increased the previous
resource estimate
of approximately 542,000
contained troy ounces gold
(23.6 million tons grading
0.7 g/t gold) previously
announced June 16, 2010 in
the same category.
Twenty-four inclined drill
holes with a cumulative
total of 6,609m were
utilized in the resource
estimation. They have an
average depth of 275m, with
the deepest being 527m. Dips
ranged between -50° and
-80°. The holes ranged in
size from HTW to NQ and are
spread across 22 section
lines spaced at 25m or 50m
intervals.
Gold mineralization is
related to a porphyry
intrusive body and where it
is cut by a northwest
trending fault zone, the
Jethro Structure. The gold
resource zone has a
projected strike length of
700m, strikes 120°, and dips
steeply southwest. True
width averages 165m (range
130m – 190m). Gold
mineralization is associated
with broad zones of
disseminated sulphide with
higher grade mineralization
being associated with areas
with steeply dipping sheeted
sulphide-bearing quartz vein
zones as well as
multi-generational quartz
veining, sometimes
stockworked. The gold
mineralization is hosted in
quartz monzonite porphyry
intrusive rock and also in
the encasing
meta-sedimentary sandstone
and quartzite rocks as well,
within the bounds of the
Jethro Structure.
Mineralization has been
verified to a depth of 980m
elevation, or just a little
shy of 500m below surface.
The floor of the grade model
was projected to an
elevation of 1,200m under
the original resource area
and 1,300m elevation under
the newer drilling to the
southeast. The floor was
lowered accordingly where
deeper holes penetrated into
mineralization at deeper
depths.
The estimation method
utilized was the constrained
block model type. Resource
was projected no more than
50m from the terminal
section lines. In situations
where drill holes collared
and/or ended in
mineralization above
cut-off, the area of
influence of a resource
polygon was not extrapolated
beyond 20m, except where
supported by adjacent
sections. The resource
estimate was performed
commensurate with CIM
definitions (2005). The
specific gravity utilized in
the estimate was 2.55g/cm3
and the cut-off grade
employed was [0.39]g/t Au. A
sensitivity analysis was
performed on the resource
estimate at various cut-off
grades with the resulting
tonnages and grades
summarized in the following
table:
Hole ICE10037 (previously
announced November 30, 2010)
was drilled [270m] north of the
resource area and off the
main Jethro
Trend. ICE10037 was not
included in the resource
estimate as the hole could
not be incorporated within
the current geological model
due to the distance between
the collar of the hole and
the current resource area.
The 2010 drilling in and
around the inferred resource
area has not closed the gold
mineralization in any
direction laterally or at
depth, with the strongest
mineralization open to
extension at the east and
west ends of the inferred
resource along strike of the
Jethro Structure and at
depth. Hole ICE10037
presents additional
opportunity for the 2011
drill season in an area
previously untested by
drilling well north of the
current resource area. ##
|
Recap of
recent exploration efforts and additional insight on the potential for many
more ounces in 2011
Results from all 12 drill
holes of AM Gold's summer 2010 drill program on Red
Mountain revealed gold
mineralization that can be traced a total distance exceeding
650 m along strike of the Jethro Structure.
Figure 6. Main area of focus for AM
Gold's Yukon drilling efforts
(above)
Building ounces
and investigating the heart of a magnetic anomaly centered on the claim
block
The orange outline area was AM
Gold's area of focus for the 2010 season. The target material
is a buried intrusive and that white area is the part that is exposed at
surface. It is believed that it slants to the west on an angle,
obviously not exposed at surface but it is believed to be quite large.
As you can see from the scale that the target zone to the North-West is
probably 2km strike length, to the west is 1.5km. AMG.V also has an
additional area to the south and the south west on Red Mountain that is
also believed to be part of a porphyry (but not the focus of this
season’s efforts).
Below is a listing of
additional drill hole releases to date on the Summer
2010 drill program, these releases have a pattern of
quality gold intersections and growing ounces:
|
Red Mountain Technical Report
June 2010 |
Additional
details
of Red Mountain project
The Red Mountain project, located about
135km east of Dawson City, Yukon, lies within the Tintina Gold Belt, a
part of the Yukon-Tanana gold belt extending across central Yukon
Territory and the state of Alaska, which contains several large
producing and developing properties, and a host of evolving gold
prospects. Intense exploration in the Yukon region has been spurred by
activity of Underworld Resources, recently acquired by Kinross, south of
Dawson City and the Eagle Gold Project, owned by Victoria Gold, 29 km
east of Red Mountain and Atac’s discovery north-east of Keno Hill, among
others. Activity has also been intensified by the recent delineation of
15 million ounces of gold resources (at ~0.6 g/t) by International Tower Resources
Ltd., some fifty miles north of Fairbanks Alaska, and the continued
production from Kinross’ large Fort Knox open pit at Fairbanks,
averaging 0.45 gm/t at a cash cost of under $450/oz. Both are within
this major structural belt. Road improvements during 2009 assisted in
the efficient operation and service of the 2010 drill programs.
|
Figure 8. Bulldozer on Red
Mountain - Road Accessible
Click to enlarge |
• Original/main
claims: 1087 Hectares, 52
contiguous claims within the Tintina Gold Belt
• Newly staked land
(June 2011): 131 quartz claims covering approximately 2,400
hectares
• NI 43-101 inferred resource estimate of ~1,230,000 oz
Gold
• 55 km northwest of Mayo, Yukon, 135 km east of Dawson City, Yukon
• Road accessible
• Buried intrusive
structure was identified during 2004 drill program
• Large aeromagnetic
anomaly at property center
|
The property hosts significant gold
mineralization and sits in the middle of "elephant country" within the world famous Tintina Gold Belt,
long known for significant Gold deposits (the following image was
prepared in 2010 -- readers are urged to check the values/numbers with
the respective companies as there is a good chance they have since
changed (for the better)):
Figure 9. Neighboring Yukon Gold
Discoveries Red Mountain is strategically located on trend within the Tintina Gold Belt - a
review of local successes will provide insight into what shareholders of AMG.V might look forward to should the first resource estimate prove
promising and built upon;
• To the south-west you have Underworld's
White gold property (1Moz indicated and 400K inferred) -- it was
acquired by Kinross in an all share transaction worth between
$120-$140M.
• To the west is the last commercial mine to be in production in the
Yukon; was held by Viceroy at Brewery Creek where 278,484oz of gold was
produced between 1996 & 2002. Gold hit a bottom of ~$250/oz and they
were producing at a cash cost of ~$192 per ounce which was extremely
low. The gold mineralization was at surface, it was all heap leachable
oxide material, and that is why the production costs were so low. Viceroy (not
thinking gold would ever rise significantly again) stopped mining and
reclaimed the land – leaving more than 200,000 ounces of gold under this
reclaimed land -- Alexco Resource Corp. took over the property, they are
mainly silver focused so they joint ventured the project to Golden
Predator.
• Keno Hill (seen on the far right) is owned by Alexco. Between 1946 –
1992 over 217M oz silver was mined. They believe they have
~30M ounce of silver still there. Alexco is sitting at ~US$7/share
with a market cap of ~$500M.
• To the east of Red Mountain (~20Km to the West of Keno Hill) is Dublin
Gulch, owned by Victoria Gold Corp. Their Eagle Gold Project at Dublin
Gulch currently has a 6.3M ounces gold resource (300 million tonnes
grading 0.64 g/t).
The most advanced mine in the region that
is anticipated to go into production at some point over the next few
years is Victoria Gold's Dublin Gulch. Mining MarketWatch notes that
Victoria Gold is ~20% owned by Kinross. With Kinross now owning
Underworld and a major share position in Victoria Gold, the positioning
of Red Mountain (subject to a favourable resource estimate ) would make
it an ideal target for Kinross.
Red Mountain Historic Drilling and
Technical Data are provided below:
|
Red
Mountain Technical Report
Jul 2006
Click To Access |
Significant assay results from AM
Gold's 2010 Drill Program:
|
Hole Number |
From
Metres |
To
Metres |
Interval
Metres |
Au
gm/t |
|
ICE10028 |
0 |
526.57 |
526.57 |
0.75 |
|
Including |
48.50 |
149.90 |
101.40 |
1.41 |
|
Including |
87.50 |
102.00 |
14.50 |
4.23 |
|
Including |
446.00 |
475.05 |
29.05 |
1.25 |
|
Including |
488.40 |
508.75 |
20.35 |
1.83 |
|
ICE10029 |
4.50 |
455.50 |
451.00 |
0.58 |
|
ICE10030 |
26.00 |
294.50 |
268.50 |
0.72 |
## |
------ ------ ------ ------ ------ ------
AM Gold's
Management & Technical
Leadership:
Skip to top
The current board of directors has a well rounded
combination of people that each contribute expertise in
disciplines necessary for a successful mining entity:
Mr. John Fiorino, CEO and Director
Mr. Fiorino currently sits on the board of several
private companies and is currently the President/CEO of
Infinite Merchant Solutions Inc. As a financier,
businessman, investor and consultant with over 15 years
experience in assisting private and public companies
with corporate operations, capital development,
financing and strategic advisory services, he has
concluded mining transactions involving gold and other
commodities in North and South America.
Mr. Gerald M Aberle, B.Sc., President, COO and Director
Mr. Aberle graduated in 1980 from South Dakota School of
Mines and Technology with a Bachelor of Science Degree
in Mining Engineering and has over 30 years of
experience in the minerals industry, including 22 years
with Homestake Mining Company at the Homestake Gold Mine
at Lead, South Dakota. Mr. Aberle's mining background
includes extensive engineering, operations management
and project management experience. Over the past 11
years, Mr. Aberle has consulted in the mining,
underground construction and minerals exploration
business for clients including Homestake Mining Co –
Barrick Gold, the State of South Dakota and the
University of Washington in connection with the planning
and development of the National Science Foundation's
National Deep Underground Science and Engineering
Laboratory. In addition, Mr. Aberle has more than 15
years of private business experience in the United
States, primarily in the land development and
construction industries.
Dr. Stewart Jackson, P.Geol., Director
Dr. Jackson
is an accomplished mining professional with 49 years of
experience in the exploration and development of mineral
deposits and in the management of public companies. He
has been involved in multiple mineral discoveries and
evaluations.
Most recently Dr. Jackson has been involved in the
acquisition and delineation of one of the most
significant discoveries of modern mining history; a
major uranium, molybdenum, nickel and vanadium resource
in Sweden on properties held by Continental Precious
Minerals Inc. These properties contain a significant
uranium resource exceeding 1.1 billion pounds of uranium
oxide (U3O8), 17 billion pounds of vanadium (V2O5), 1.5
billion pounds of molybdenum (Mo) and 2.3 billion pounds
of nickel (Ni), with drilling continuing to expand the
resource.
Prior to that he was instrumental in the advancement of
the Turnagain nickel sulphide deposit of northern
British Columbia, Canada, held by Hard Creek Nickel
Corporation, from a prospect to the billion tonne
resource category.
While involved with his initial public company, Crown
Resource Corporation in the 1980’s, multiple discoveries
of gold were made in Washington State, USA; totalling to
date in the order of 4.5 million ounces; continuing to
be produced by Kinross Gold Corporation.
In the 1970’s he recognized the potential of the
enormous Red Dog zinc-lead deposits in western Alaska,
and was instrumental in their exploration and
development by Cominco American Incorporated (now Teck-Cominco).
Red Dog today produces over 6% of the world production
of zinc from this long-lived zinc resource field.
Subsequently, he was Exploration Manager for Houston Oil
and Minerals Corporation during the discovery and
development of the Manhattan, South McCoy and Borealis
gold deposits of Nevada, USA.
Dr. Jackson has authored and co-authored a number of
scientific publications, is a member of several
scientific and professional organizations, and holds a
Professional Geologist (P. Geol.) Registration in the
Province of Alberta, Canada. He holds a Bachelor of
Science degree in Geology from the University of Western
Ontario, a Master of Science degree in Stratigraphy and
Mineral Deposits from the University of Toronto, and a
Ph.D in Stratigraphy and Economic Geology from the
University of Alberta.
Mr. Neil Downey, P. Geo., BSc. Geo, Vice
President of Exploration
Mr. Downey is an exploration geologist with over 30
years of mineral exploration experience in gold, uranium
and base metals. He has planned and implemented
multi-faceted exploration programs from the grass roots
level to resource definition resulting in producing
mines. Mr. Downey is a graduate of the University of New
Brunswick with BSc. Honours, Geology.
Mr. Dennis B Goldstein,
Director
Mr. Dennis B. Goldstein is a practicing natural
resources lawyer in San Francisco, California with 37
years' experience in the mining business, including 26
years with Homestake Mining Company, a New York Stock
Exchange listed, international gold mining company. When
Homestake was purchased by Barrick Gold Corporation in
2001 for $3.34 billion CDN, he was Vice-President and
Corporate Counsel. Mr. Goldstein is the Lead Director of
FX Energy Inc., an oil and gas exploration and
production company active in Poland. He has served on FX
Energy Inc.'s Board of Directors since 1999. In addition
to Lead Director, he currently is chairman of FX Energy
Inc.'s Nomination and Governance Committee and member of
its Audit and Compensation Committees. Mr. Goldstein is
a graduate of Brown University, Stanford University Law
School, and Executive Program of the Stanford Graduate
School of Business. He is a member of the California and
the American Bar Associations and speaks Spanish and
Italian.
Dr. Kelly Hyslop,
Director
Dr. Hyslop is retired after 25 years as a Physician and
Clinical Professor in the Department of Medicine at UBC. Dr Hyslop is
and has been involved in multiple companies, generally aiding the
companies in raising capital in Europe and offering his experience in
corporate governance as a member of the Board of Directors.
Mr. Mark Lawson, MBA, CFO and Director
Mr. Lawson is currently the President & CEO, Director of
New Global Ventures International Ltd., a company listed
on the TSX Venture Exchange. He is also a director of
Bradenburg Metals Corp., Toro Resources Corp., Hunter
Bay Minerals PLC, and EcoloCap Solutions Inc. Mr. Lawson
worked as an investment banker with Morgan Stanley in
New York from 2005 until 2008 where he was involved in
the execution of over $6-billion worth of mergers and
acquisitions, $8-billion worth of debt offerings, and
$500-million of equity financings. Mr. Lawson was
previously a director of a boutique corporate finance
firm in Toronto, Canada. He received his bachelor of
arts in statistical sciences from the University of
Western Ontario and his MBA from The Richard Ivey School
of Business, Univeristy of Western Ontario. Mr. Lawson
was also a 1st round draft pick of the CFL Edmonton
Eskimos. ##
------ ------ ------
------ ------ ------
Full management web page
of AM Gold click
here
Note: This list is not intended to be a complete overview of AM
Gold Inc. or a complete listing of
AM Gold's projects. Mining MarketWatch urges the reader to contact the subject company and has
identified the following sources for information:
For more information
contact AM Gold's head office at:
Ph
1.877.646.0067
Company's web site:
www.amgold.ca
SEDAR Filings:
URL
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The
risk-reward characteristics are highly advantageous for investors
establishing a long position in AMG.V as the current market cap of AMG.V
relative to the inherent value of their properties seem
disproportionate. Shares of AM Gold appear poised for
significant upward price movement with only ~54M shares outstanding
(~67M fully diluted) and is trading under CDN$0.50. AM Gold’s
current in-situ gold resource (Market Cap/Oz Au In-Situ) valuation
is one of the best bargains in the mining sector.
