Bullfrog Acquires Strategic Land Positions

 

GRAND JUNCTION, CO - Bullfrog Gold Corp has acquired two strategic land positions adjacent to its Bullfrog Project located 3 miles west of Beatty and 120 miles northwest of Las Vegas, Nevada. These lands include the entire Montgomery-Shoshone (“M-S”) deposit where 70,000 ounces of gold were underground mined in the early 1900’s and 220,000 ounces of gold were open pit mined during the 1990’s by Barrick Gold Corp. Also included is the northern one third of the main Bullfrog deposit where Barrick mined approximately 2.1 million additional ounces by open pit and underground methods. In addition to prospective adjacent lands, these acquisitions provide the potential to expand the M-S deposit along strike and at depth and in the northern part of the main Bullfrog deposit.  

Twelve contiguous patents that include the northeast half of the M-S pit were optioned to purchase by Rocky Mountain Minerals Corp. (RMMC), a wholly-owned subsidiary of the Company, from Mojave Gold Mining Company (Mojave).  Mojave, a private company based in Salt Lake City, Utah, has an exclusive option to purchase the 12 patents from two owners who secured quiet title and 100% interest in early October 2014. On October 29, 2014, Mojave was paid $16,000 plus 750,000 shares of Bullfrog common stock on closing and, to earn a 100% interest, is scheduled to be paid $200,000 over nine years while performing no less than $100,000 of work per year for five years on or within ½ mile of the 12 patents. Mojave retained a sliding scale Net Smelter Return royalty ranging from 1% for gold prices below $1200/ounce and up to 4 % for gold prices above $3,200 per ounce. For reference, Barrick terminated a lease on these patents after they ceased operations in late 1999.

The Company’s lease and option with Barrick was signed on March 23, 2015 and includes 6 patents (two of which cover the southwest half of the M-S pit); 20 unpatented claims that cover the northern one-third of the main Bullfrog deposit and 8 nearby mill site claims. The Company also has access to Barrick’s substantial data base within a 1.5 mile radius of the leased lands to further advance its exploration and development plans and programs. To maintain the lease and option, the Company must spend $1.5 million dollars within five years on the Barrick properties and then pay Barrick 3.25 million shares of Bullfrog stock while providing a 2% gross royalty on production from the Barrick properties. Overriding royalties of 5% net smelter returns and 5% gross proceeds are respectively limited to three claims and two patents in the main Bullfrog pit area.  Barrick has retained a back-in right to reacquire a 51% interest in the Barrick properties, subject to definition of a mineral resource on the Barrick properties meeting certain criteria, and reimbursing the Company in an amount equal to two and one half times Company expenditures on the Barrick properties.

Company management has estimated that 41,000 ounces of gold in 1.44 million tons of material averaging 0.97 gram per ton remains within a cutoff depth up to 75 meters under the existing M-S pit. This manual estimate was based on cross sections typically spaced 15 meters apart, a cutoff grade of 0.3 gram gold per ton at the top and bottom of mineral intervals, and drill data and pit surveys completed by Barrick. Notwithstanding, Barrick makes no representation concerning the accuracy or completeness of the data used by the Company. Additional drilling is required to confirm some of the Company’s mineral projections and to test for extensions at greater depths and along strike beyond the existing pit limits. Half of this M-S mineralization is on two Barrick patents within the pit and half is on two of the 12 Mojave patents. The direct ratio of waste to mineral tons within a cross-sectional preliminary pit outline is 0.97:1, but this does not include waste removal for ramps and other considerations that would otherwise be included in a future pit plan based on computerized block modelling and 3-D mine planning and design  programs. It is further cautioned that the Company’s current and expanded properties contain no reserves or resources and that the estimates and additional potential mineralization discussed herein may never become viable, feasible or economic. These estimates were mainly prepared to assess the available M-S information and plan additional drilling. 

Significant drilling is required to test projections of mineralized trends and structures that extend for considerable distances to the north and east of the M-S pit on the original lands acquired by the Company in 2011. Located east of the M-S pit is an area 700 meters by 1,300 meters in which there is only one shallow hole from which there is no data available. Only a portion of this area may be prospective, but it certainly warrants additional study and exploration drilling.

There is only one drill hole located about 150 meters NE of the M-S pit limit and another hole 1000 meters NE of the pit along strike of a major geologic structure.  In this regard, the Company’s lands extend nearly 5,000 meters NNE of the pit and there has been very little drilling in this area, even though several structures have been mapped by Barrick and others.