Pilot Gold Updates Progress At Priority Targets
VANCOUVER, BC - Pilot Gold Inc. reported its financial results for the second quarter ended June 30, 2013, and provides an update on activities highlighted by continued strong gold and silver drill results at TV Tower’s KCD target, the launch of drilling at TV Tower’s oxide gold Kayali target in Turkey, and the resumption of drilling at Kinsley Mountain, Nevada.
Matt Lennox-King, President and CEO said, We will continue to build on our success in the second half of 2013, with significant exploration drilling of an additional 29,000 meters at our priority projects, and expect to meet key resource and permitting milestones by year end.
Kinsley is a Carlin-style, sediment hosted project and past producer located along the Long Canyon Trend in North Eastern Nevada. Pilot Gold earned a 65% interest in Kinsley Mountain in February 2013.
Pilot Gold launched a planned 22,000-meter RC and core drill program on July 16, 2013. The current program is designed to extend and further define Kinsley’s high-grade and bulk-tonnage mineralization and will include geophysical, engineering, metallurgical surveys, and district wide exploration. A subsidiary of Nevada Sunrise Gold Corporation (NEV) currently holds a 35% interest in Kinsley. The Company is project operator. To maintain their respective current pro rata interest, each joint venture partner is responsible to fund its share of expenditures at Kinsley.
The Company currently awaits receipt of an Approved Record of Decision from the United States Interior Departments Bureau of Land Management ("BLM") for a Plan of Operations. Upon receipt, the approved Plan of Operations will allow for expanded exploration activities over an area of up to 70 acres in the southern third of the property, beyond the previously disturbed areas. Currently, exploration is being conducted under the existing Notice of Intent.
Through June 30, 2013 the Company had capitalized approximately $0.70 million in expenditures at Kinsley (year ended December 31, 2012: $3.67 million). During Q2 2013, $0.21 million was recovered from NEV, the Company’s partner at Kinsley pursuant to that company’s provisional funding of the first cash call (maintain its pro rata share of costs at Kinsley through to June 30, 2013).
A total of 1,542 meters has been completed to date under the 2013 program, with approximately $0.7 million incurred through June 30, 2013 of a budgeted $5.2 million for the year.
Pilot Gold currently holds a 40% interest in the TV Tower project and became project operator in 2012 with an option to increase the Company’s interest in TV Tower from 40% to 60%. The $5-million, first-year minimum earn-in expenditure commitment was completed in January 2013. In March 2013, the Company issued 1,637,500 common shares to "TMST", a subsidiary of Teck Resources Limited ("Teck") the Company’s 60% joint venture partner at TV Tower, in connection with achieving this first milestone. During the six months ended June 30, 2013, Pilot Gold had incurred approximately $5.56 million in Eligible Expenditures at TV Tower (year ended December 31, 2012: $4.77 million), and has $1.7 million remaining to surpass the second-year $7-million earn-in expenditure requirement. The 2013 program, with a budget of $7.9 million, is currently underway.
The planned program at TV Tower for 2013 includes 30,000 meters of drilling at KCD, Kayali and other priority targets. At KCD, the 2013 drill program includes a planned 15,000 meters of infill and step-out drilling on the gold and silver zones and a staged metallurgical testing program. Drilling has begun at the Kayali bulk-tonnage, oxide target, with 7,500 meters planned in 2013. An additional 7,500 meters is planned at other promising targets upon receipt of forestry permits. In the six months ended June 30, 2013, approximately 13,700 meters of drilling had been completed in the 2013 program. To date there have been approximately 18,000 meters drilled in the 2013 program.
The Company holds a 40% interest in Halilaga, copper-gold porphyry located 20 kilometers southeast of TV Tower. Halilaga advanced considerably during 2012, with an initial resource estimate and the completion of a preliminary economic assessment (the "Halilaga PEA"). ╩Based on recommendations of the authors of the Halilaga PEA, Pilot Gold has initiated a number of strategic studies in conjunction with TMST, the Company’s 60% partner and operator at Halilaga. The strategic studies underway include economic, metallurgical, environmental and engineering analyses to advance the concept and potential of this porphyry project.