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Located three miles east of Kellogg in Idaho’s Silver Valley,
the New Jersey mine property includes the gold-bearing Coleman
vein system, a base metal Sullivan-type exploration prospect
known as the Enterprise (see Press Release dated July
28, 2003), and another gold prospect known as the Scotch
Thistle. Also on the property is a 100 tonne per day mill
(mineral processing plant) with a flotation circuit, and a
newly constructed concentrate leach plant.
The Company’s land position in the New Jersey area of interest
covers approximately 430 acres. Two mineral leases covering
130 acres are included in this total and require the payment
of Net Smelter royalties. More detailed information can be
found in the Company’s Annual Report Form 10-KSB.
Open pit mining on Coleman vein at New Jersey Mine
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Three mineralized systems are found at the New Jersey, the Coleman
vein, Scotch Thistle and Enterprise. The Coleman vein is a gold-bearing
quartz vein which cuts bedding of the Prichard formation. Associated
sulfide minerals are pyrite, arsenopyrite, low-silver tetrahedrite,
galena and sphalerite. Visible gold can be found in the Coleman
vein and is usually associated with tetrahedrite. Cumulative
strike length of the Coleman vein and related branches has been
measured to be approximately 460 meters.
Historic prospecting activity took place at the New Jersey
mine in the late 1800’s and early 1900’s. About
2,500 feet of development workings including drifts, crosscuts,
shafts and raises were driven at that time to develop the
Coleman vein and a related branch vein. However, only about
200 feet of development were on the Coleman vein structure
itself. Management believes the lack of development work on
the Coleman vein by the old-timers leaves considerable potential
to find an ore shoot within this strong vein structure.
Well known Coeur d’Alene District geologist, Oscar Hershey,
commenting in 1916 on the gold mineralization found on the
Coleman vein said, “This suggests that if this fine large
vein were developed for 2000 ft. instead of merely 200ft.,
a commercial ore shoot may be found.”
Diamond drilling completed by the Company in 2002 indicated
higher grade gold mineralization north of the historic workings.
DDH02-2 intercepted 12.5 meters that assayed 2.5 gpt gold
including a higher grade core of 2.5 meters of 6.8 gpt gold
(see Press Release dated September
5, 2002.) DDH03-07 intercepted 0.55 meters that assayed
13.2 gpt gold.
In early 2007, the company acted on Oscar Hershey's advice
and commenced an exploration drifting program from the lowest
adit located just above the mill. Exploration plans also call
for more diamond drilling at the Scotch Thistle area of the
New Jersey property (see Press Release dated August
17, 2004).
Ore reserves have been calculated for that part of the Coleman
vein which is mineable by open pit methods. Those numbers
are summarized below:
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Ore Reserves (Proven
and Probable)
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| Ore Blocks |
Metric Tonnes
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Grade (Au Grams/ Tonne)
|
Ounces (Au)
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| Coleman (17+00 to 21+00) |
56,250
|
4.59
|
8,302
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| Coleman Split (21+00 to 23+00) |
20,753
|
3.53
|
2,356
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| North Vein (21+00) |
2,990
|
8.57
|
824
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| Total |
79,993
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4.46
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11,482
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The open pit reserve tonnages are diluted. That is, the expected
dilution from open pit mining is accounted for in the grade
and tonnage of the reserve blocks. The ounces stated in the
above table are contained ounces. The cutoff grade used to
calculate reserves is 3.5 gpt gold which is based on the Company's
historical costs for open pit mining and flotation at its
100 tpd mineral processing facility. A gold price of $513
per ounce ($16.50 per gram) was used.
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