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DAILY NEWS Jan 9, 2013 4:15 PM - 0 comments

Northern Freegold homes in on Nucleus deposit high grade

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VANCOUVER – A new resource estimate outlining a higher-grade starter zone has put the Freegold Mountain project in prime position as owner Northern Freegold Resources (NFR-V) finalizes the project's first economic assessment.

Sitting just 200 km northwest of Whitehorse in the Yukon, the 198-sq. km Freegold Mountain project is home to three defined deposits plus several other drill-tested mineralized zones. In summer 2012 Northern Freegold focused its efforts on the Nucleus deposit, which is adjacent to the larger, lower grade Revenue deposit.

The company worked to define a potential Nucleus starter pit while also massaging the overall resource into a smaller, higher-grade entity. The efforts paid off.

The redefined Nucleus deposit contains 71.9 million indicated tonnes grading 0.57 gram gold per tonne, 0.85 gram silver per tonne, and 0.06% copper, using a cut-off grade of 0.25 gram gold equivalent. Inferred resources add 60.4 million tonnes averaging 0.41 gram gold, 1.5 grams silver, and 0.04% copper.

Increasing the cut-off grade to 0.4 gram gold equivalent changes the indicated resource to 36.1 million tonnes grading 0.85 gram gold and 1.01 grams silver and the inferred resource to 29.2 million tonnes grading 0.55 gram gold and 2 grams silver. Those numbers represent a 19% increase in gold grade compared to the previous Nucleus estimate.

In addition, the indicated resource contains that significant zone of higher-grade mineralization. At a cut-off grade of 0.5 gram gold equivalent, this distinct zone contains 25.9 million tonnes averaging 1.02 grams gold, 1.11 grams silver, and 0.07% copper.

Northern Freegold believes the zone could be exploited in the initial years of a mining operation to help pay back capital costs more quickly. Soon the company will know for sure whether this is the case: a preliminary economic assessment of the Nucleus and Revenue deposits is well underway, with results expected within the next few months.

Nucleus and Revenue are only a few kilometres and collectively cover 30 sq. km. The mineralization at Revenue is a fairly typical copper-gold porphyry, while Nucleus is an intrusive-related low sulphidation epithermal deposit sitting within the porphyry system.

The company completed an initial estimate for the Revenue zone in early 2012, which pegged inferred resources at 158 million tonnes grading 0.27 gram gold, 2.49 grams silver, and 0.11% copper. That means the two deposits together host 1.3 million ounces of indicated gold and 1.9 million ounces of inferred gold.

Metallurgy will not present a problem for the project's economics. In September, Northern Freegold announced preliminary results from testwork on the Nucleus deposit, which found that whole-ore cyanide leach processing recovered 97% of the gold and 51% of the silver from the mineralized rocks.

Northern Freegold believes Revenue, Nucleus, and the Stoddart zone to the east are all part of a large-scale gold-rich porphyry system that stretches out for more than 8 km east-west across the Freegold Mountain property.

The large property is well-situated with respect to the kinds of infrastructure needed to build a mine. It is accessible by road and electric grid power is available within 30 km.

News of the resource estimate added 2¢ to Northern Freegold's share price, bringing it to 14.5¢. The company has a 52-week range of 7.5¢ to 37¢ and has 126 million shares outstanding.

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Northern Freegold Resources Ltd

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Freegold Mountain Project

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