VANCOUVER — It is full steam ahead for Vancouver-based explorer Kaminak Gold (KAM-V) at its wholly-owned Coffee gold project in the Yukon's White Gold district. Fresh off its maiden resource, which cemented Coffee's multi-million ounce gold potential, Kaminak is back at work with an $11 million exploration program that should see drilling underway in early March.
In mid-December Kaminak outlined an inferred resource at Coffee totalling 64 million tonnes grading 1.56 grams gold per tonne for 3.23 million contained oz. at a 0.5 gram gold cut-off. Perhaps more impressively, 28 million tonnes at an average grade of 1.64 grams gold consist of near-surface oxide material.
On Feb. 26 Kaminak outlined its objectives for 2013, as well as bumped its cash position to $16 million by completing a private placement worth roughly $1 million that involves the issuance of 746,250 shares at a price of $1.34 each.
Kaminak will continue to focus on its shallow and high-grade oxide resources during 2013, which are hosted mostly within the Supremo, and Double Double deposits. The Supremo trend currently consists of seven north-south trending gold-bearing structural zones — labelled T1 to T7 — which are co-incident with a well defined 2-km by 2-km gold-in-soil anomaly.
Double Double is associated with a regional east-northeast trending and steeply north-dipping structure co-incident with a 600-metre by 100-metre gold-in-soil anomaly. The structure is comprised of shear zone and breccia fabrics overprinting variably-textured schist giving the overall appearance of a high-strain fault zone.
In 2012 Kaminak punched 348 holes at Coffee over roughly 69,000 metres and succeeded in making discoveries at the Supremo T4, T5, T7 and Sugar zones, as well as establishing over 8.5 km of mineralized strike within the 2-km by 2-km Supremo, Double Double and Latte area. Exploration drilling completed through the third quarter of 2013 will be incorporated into an updated resource estimate that should pave the way for Kaminak's inaugural economic study.
The company will also be following up on initial metallurgical testing that involved a series of heap-leach column tests on oxide materials from Supremo, Latte and Double Double and returned 90% recoveries over 80 days, including 83% recoveries over a 15-day period. Kaminak will ramp-up its metallurgy this year, focusing on expanding work to a broader range of samples that will include transitional and sulphide material from depth.
In addition the company will be chasing plenty of blue sky on its 600-sq.km land package. Current resources cover less than 15% of the overall property, and with Kaminak's established success with its geochemical programs it isn't a stretch to see the project yielding further discoveries. The company plans to collect 10,000 soil samples this year to improve its regional coverage.
In early February Kaminak shuffled its management team to strengthen its developmental experience going forward. Eira Thomas replaces Rob Carpenter as president and CEO. Thomas sits on the board of a number of notable Canadian resource companies, including Suncor Energy (SU-T, SU-N) and Dundee Precious Metals (DPM-T). In addition Richard Hall will be joining Kaminak's board. Hall helmed Northgate Minerals when AuRico Gold (AUQ-T, AUQ-N) paid roughly $1.5 million in 2011 to get its hands on the Young-Davidson gold mine in Ontario.
"Our work program is designed to expand upon and define preliminary economic parameters for core resource areas at Supremo, Latte and Double Double, while at the same time continuing with an aggressive drilling campaign to identify additional resources over the broader [Coffee district],” Thomas commented. “In addition to the ambitious drilling and resource campaigns that are planned for 2013, Kaminak intends to initiate early-stage engineering studies in support of a preliminary economic assessment.”
Kaminak received a market boost following news of its 2013 program, jumping to a high of $1.25 per share during mid-day trading on Feb. 26. The company lost its momentum in subsequent trade sessions, however, falling back to close at $1.09 per share on March 1.
Kaminak has had a rough ride on the market to start 2013, dropping 32% or 51¢ since early January. The company has 83 million shares outstanding at time of writing for an $89.5 million press-time market capitalization.
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