Ely’s Mina Gold property is located along the western margin of the Cedar Mountains in central Nevada’s Walker Lane Mineral Belt in eastern Mineral County, Nevada. The property covers an area of approximately 825 acres comprising 43 unpatented lode claims and five patented lode claims in the historic Bell Mining District. It is approximately seven miles northeast of Gold Resources’ Gold Mesa property and 15 miles east of the Isabella/Pearl Project. Gold mineralization at Mina is hosted by outcropping epithermal quartz veins within fault zones in Tertiary volcanic rocks, typical of many Walker Lane ore deposits.
Nevada Select successfully consolidated the Mina gold property in 2016 by purchasing eight unpatented claims from Nevada Eagle LLC (Ely press release dated May 4, 2016), acquiring five patented claims through a property exchange with Timberline Resources Corp., and staking 35 additional unpatented lode mining claims on open ground (Ely press release dated August 15, 2016.
Gold mineralization was discovered and exploited at Mina over 100 years ago on what became the Monster Patent. Modern exploration over the last 40 years has identified the persistence of the Monster Zone into a defined zone of at least three parallel structures approximately 45 meters apart with a strike length of at least 1500 feet; it remains open at depth and along strike onto unpatented claims. Between 1975 and 1997 seven exploration companies drilled 313 holes totaling 53,300 feet of drilling - of which 162 (42,398 feet) were Reverse Circulation hole and five were core holes (1,727.5 feet) - and sampled surface exposures of multiple veins (Raabe, 2007). Step-out drilling has been a good prospecting tool for new mineralization in all past exploration campaigns.
Continuity of grade and widths of mineralization led at least three of the companies to attempt resource calculations in hope of defining a mineable ore body, although only the original owners and the first modern owner, F.W. Lewis, did any mining.
Ely has acquired the bulk of the historic drill data as well as assays from surface and underground sampling programs. This data base forms a solid foundation for current and future exploration by Gold Resource Corp., who are currently doing definition drilling for a new resource/reserve study.
The first gold production from the property was reported as “$4,400 … in 1912” (about 213 ounces) at a grade “between $7 and $8 a ton” (0.34 to 0.39 ounces per ton) from a calcite-quartz vein about 2-4 feet thick striking northwesterly with a shallow dip to the northeast - probably the Monster vein (Knopf, 1921). Underground work on the Monster Zone eventually included a 400 foot adit, two 50 foot winzes and open stope and pillar mining of an unknown amount of mineralized vein material. Underground development of the adjacent Down Cabin, Far North and East Zone was contemporaneous with mining at the Monster, although no production was recorded. There is no further recorded activity for the property until 1972 when F.W. Lewis acquired the patented claims. In 1976 Lewis mined about 2,000 tons from the Monster Zone and attempted to heap leach the material, with marginal success.
From this point on the Mina Gold property was optioned out to a string of successive exploration companies that conducted geological mapping, surface sampling and drilling programs. In 1975 Cutlass Exploration, Ltd. of Vancouver optioned the claims and drilled almost 2000 feet of core and reverse circulation (RC) holes on the Monster Zone, as well as trenching, with associated sampling and assaying.In 1980, Pat Mines Inc. optioned the claims, cut trenches and drilled eleven reverse circulation (RC) and three core holes in the Monster Zone. In 1983 Amir Mines took over the property, completed a soil grid for mercury, additional trenching and seventeen RC drill holes on the Monster Zone as well as five RC drill holes in the Down Cabin Zone. In 1986 FMC Gold drilled sixteen RC holes on the Monster Zone and six RC holes on the Down Cabin Zone. They also trenched and sampled the west and east extensions of the Monster Zone. In 1988, Black Beauty Gold drilled seventy-six RC holes in the Monster, Down Cabin, East End, Far North and Far West areas. From 1989 to 1992 the F.W. Lewis Co. drilled thirty RC holes on the Monster Zone, a 515-foot water well and twenty-seven air-track holes. Glamis Gold optioned the property in 1996 and initiated a comprehensive program of computerized data compilation coupled with geologic mapping and extensive rock sampling, followed by testing of generated targets with almost 7,000 feet of RC drilling.
Mina Gold is a low sulfidation (quartz-adularia) precious metal-bearing epithermal vein system in a northwest-trending set of Walker Lane faults. The property is characterized and mineralized veins are hosted by Tertiary (Oligocene-Miocene) andesites, rhyolites and dacitic tuffs unconformably overlain by limestones and tuffaceous clastic rocks of the Late Miocene Esmeralda Formation. The Tertiary volcanic section unconformably overlies Mesozoic sedimentary and intrusive rocks, including limestones of the Triassic Luning Formation –host for base metal mineralization at the nearby Simon Mine.
Gold-silver mineralization at Mina is primarily associated with N60-80W trending fault zones that cut the volcanic section, forming linear zones of pervasive epithermal alteration with cores of intense silicification containing higher grades.These areas of silicification vary from weak to intense stockwork as well as true linear quartz veins in some places.Two principle zones have been identified to date - Monster and Down Cabin – which parallel and may be co-extensive with the major regional Cedar Mountain Fault. Alteration and weak mineralization is also associated with the east-northeast trending Mammoth-Simon Fault (East End Zone and Far West Mercury Zone) as well as the possibility of a southeast extension of the principal zones under younger tuffs (Far East Zone).
The Monster Zone is a belt of altered and brecciated andesites averaging 600 feet in width and over 4500 feet in length; the Down Cabin Zone averages 300 feet in width and over 3000 feet in length. Both zones are characterized by pervasive propylitic alteration grading into more restricted argillic alteration containing silica breccias, veins that may be replacements of more extensive calcite zones and discrete areas of stockwork veining. Mercury, at anomalous levels,is more widespread than gold within the larger alteration zone and may offer help in identifyinggold targets at depth. The Monster Zone has two discrete places of past exploitation on stockwork and vein replacements – Monster Adit and Monster Shaft – that are about 300 feet apart within the broader zone.Rosta (1986) states that the Down Cabin Zone is expressed more as “quartz-limonite stockworks with scattered mineralized quartz breccia set in a strongly clay-altered andesite” (with) “a vuggy-silicified cap occur(ing) immediately above and to the southwest the stockwork veining”. He further suggests that the Down Cabin Zone may represent a higher level epithermal setting than that present at the Monster Zone, providing a glimmer of hope that Monster-style mineralization may exist at depth.Drilling has been sparse in the Down Cabin Zone relative to the Monster Zone.
In defined mineralized areas, grades vary from 0.003 to 0.148 oz/ton gold and have a silver to gold ratio of about 1.4:1 (Rosta, 1986). Where distinct veining or brecciation is encountered, grades can be significantly higher, with one hole (1989) reporting 0.546 opt Au over 10 feet in a total intercept of 40 feet averaging 0.215 opt Au (Breitrick, 1989). Drilling has demonstrated that mineralization is continuous over longer distances at lower grades (0.03 to 0.05 opt Au) and continuous over shorter distances at higher grades (0.07 to 0.15 opt Au), creating difficulties in establishing confidence of average grade in past resource calculations where drill hole density was sparse (Steininger, 1997). Glamis completed a mineral inventory of the Monster Zone in 1997 following a very focused drilling program, using MEDSystem (Mine Reserves Associates of Golden, Colorado), that delineated 1,606,000 tonnes of mineralized material grading 1.88 grams per tonne gold, using a cutoff of 0.31 grams per tonne (roughly 3 million grams or approximately 97,000 ounces of gold). The estimate is historical and not in compliance with NI 43-101. The historical estimate is supported by a technical report, but a qualified person has not done the work necessary to verify the historical estimate as a current estimate under NI 43-101 for the Company and the estimate should not be relied upon.
The Mina Gold property is just 2 miles west of the Simon mine, where zinc and lead occur as replacements in limestones of the Luning Formation; the Simon experienced significant production of zinc and lead during the World Wars in the 1920s and 1940s. More significantly, the Olympic (OMCO) Mine, also controlled by Ely Gold, is situated in a similar and parallel structural setting just four miles to the north. Production of over $700,000 in gold and silver came from a flat-dipping vein in volcanic rocks of the same age as Mina at about the same time as production from the Monster Zone (Rosta, 1986). The past-producing Santa Fe gold/silver lies 12 miles to the west of Mina and Gold Resource Corp.’s (GRC) Isabella/Pearl Project is 2 miles further northwest. The Santa Fe mine produced 345,499 ounces of gold and 710,629 ounces of silver from 1983 to 1994 at an average grade of 0.034 ounces (1.06 grams per tonne) gold and 0.25 ounces (7.8 grams per tonne) silver.GRC reports a total resource of 2,733,500 tonnes grading 2.18 grams gold per tonne or 191,400 ounces of contained gold (Gold Resource Corp. Website).
Ely Gold does not imply or suggest that the geology or mineralization on
the Mina property is similar to any projects within close proximity or adjacent
to the Mina property
and any exploration and development
by Ely Gold may not obtain similar results. Investors are cautioned that
mineral deposits on adjacent properties do not necessarily indicate and do not
prove the existence, nature or extent of mineral deposits on the Mina property.
Ely Gold’s Mina Gold property is a high quality early-stage exploration project that contains several strongly mineralized structural zones in a larger epithermal mineral system. Of these only the Monster Zone, consisting of at least two parallel structures approximately 45 meters apart, has been extensively drill tested; the zone remains open on strike and at depth. The Monster Zone mineralization is covered by patented claims, which are surrounded by multiple unpatented claims, giving additional exploration upside potential along this mineralized trend. The Down Cabin Zone may represent the upper portion of an epithermal system that was eroded at the Monster Zone, possibly presenting a deeper exploration target for future drilling.
The Mina Gold property was sold to Gold Resource Corporation (NYSE MKT:GORO) in August 2016. Ely Gold retains a 3.0% Net Smelter Royalty (“NSR”) on the claims. Gold Resource is in the process of completing definition drilling in the Monster Zone (see GORO press release of March 23, 2017).
Stephen Kenwood, P. Geo, is a director of
the Company and a Qualified Person as defined by NI 43-101. Mr. Kenwood has
reviewed and approved the technical information herein.
Breitrick, J., 1989, Geologic Summary of the Monster Zone at Mina, Nevada; internal company report, 8p.
Knopf, A., 1921, Ore Deposits of Cedar Mountain, Mineral County, Nevada; United States Geological Survey Bulletin 725H.
Raabe, K., 2007, Summary of Historical Activities, Mina Gold Property, Mineral County, Nevada; internal company report, 3p.
Rosta, Z., 1986, Summary and Evaluation Report, Mina Gold Property, Mineral County, Nevada; internal company report, 13p.
Steininger, R., 1997, Mina Gold Project Summary of Activities, internal company report, 12p.