VANCOUVER — Vancouver-based explorer Tower Resources (TWR-V) did not stray far from home when it came to picking its projects. The company boasts a strong technical team with a history of success in Western Canada, so the fact Tower holds highly-prospective precious metal plays in some of British Columbia’s more prolific exploration districts should come as no surprise.
President and CEO Mark Vanry brought the capital market experience and investment vehicle, but things really started rolling in July 2011 when members of the exploration team from Richfield Ventures jumped on board and added a degree of technical cache to the endeavour. Richfield's team was responsible for the Blackwater discovery in central B.C., which was purchased in mid-2011 by New Gold (NGT-T, NGD-X) for roughly US$550 million.
“I think the bottom line is that we have a technical team that has had some huge success recently, and I'd put our guys up against any team in Western Canada,” Vanry comments during an interview at Tower’s Vancouver offices. “We have three major assets, and any one of these could legitimately be a company-maker. I think if this was a bull market we'd likely be looking to spin some stuff out, but we don't want to babysit another company in this environment.”
Tower’s technical team includes some well-known names, like Richfield’s vice-president exploration Dirk Tempelman and industry-veteran Ken Thorsen. Tower’s vice-president exploration Christopher Leslie joined Richfield in 2009 and worked on Blackwater through the New Gold takeover.
“Previous to that I worked for a number of junior mining companies around British Columbia, with a focus on the Kemess and Toodoggone gold districts,” Leslie comments. “I think my strengths lie in project identification and trying to find where mineral systems have a lot of room to grow.”
Vanry explains that Tower screened roughly one hundred potential projects, but it wasn’t until Leslie joined the team and identified the JD gold-silver property 300 km north of Smithers, B.C., that things really started to click. Tower ended up with a 100% earn-in agreement on 150 sq.km in the Toodoggone district that featured 30,000 metres of historic drilling. JD hosts a large epithermal gold-silver system with notable showings exposed over a 3-sq.km area.
According to Leslie it was that strike length combined with a low-angled structural setting that really drew him to the JD property. Drill programs in the mid-1990s had cut some intriguing grades and widths at JD’s Finn zone, and Tower’s technical team set out to confirm the property’s potential during a 3,000-metre summer drill program.
“We wanted to confirm historic grades and volumes. Importantly for us — and I think this holds steady for a lot of Toogodone gold plays — was establishing continuity in that gold mineralization. That has really hampered a lot of exploration programs in the area,” Leslie explains, unrolling a technical map on the conference table to point out how Tower’s team had come up with a new understanding of the structural host geometry prior to drilling, “The modelling gave us the opportunity to drill perpendicular to the zone, which gives us true widths. All of our holes were drilled across historic sections. Up to this point all the drilling had been exactly south, so we were able to change that azimuth and test for volume and continuity.”
And Tower cut some impressive grades during its summer confirmation program at Finn. Highlights around the historic corridor include: 22 metres grading 4.9 grams gold per tonne and 54 grams silver per tonne from 36 metres depth in hole 12-002; 26 metres averaging 3.64 grams gold and 9.29 grams silver from 5 metres depth in hole 12-008; and 13 metres of 10.82 grams gold and 66 grams silver from 30 metres depth in hole 12-003.
Vanry points out that Tower had originally intended to release a maiden resource estimate on JD by the end of the year, but a pair of step-out holes caused management to re-consider that strategy, due to the deposits potential for expansion. Hole 12-015 stepped out 420 metres north and cut 20 metres grading 1.55 grams gold from 85 metres depth, while hole 12-009 was collared in Finn's footwall and cut 18 metres averaging 1.74 grams gold from surface.
“I think we have a good handle on the core area,” Leslie says, while reviewing the 2012 results. “But I think we need to understand how that core relates to those step outs. We had some success with large step-outs that have left us some gaps in the data package we'll ideally address next season. We're working out our budgets now, but I think we need to chase that system where it remains open.”
Tower's technical team also continued to map the regional package during the summer. The company completed 2,000 soil geochemical samples, as well as numerous grab and chip samples. Vanry says that JD's Creek zone also remains a high-priority target, with historic drill results highlighted by 4 metres grading 103 grams gold, 92 grams silver, 1.34% copper, and 11.7% zinc from quartz-carbonate stockwork cutting brecciated and chlorite-silica altered volcaniclastic rock.
“In the Toodogoo region soil geochemistry is extremely important,” Leslie explains. “If you want to expand the thing and identify how this system maintains continuity along that structure we've mapped out, we need to keep identifying those drill targets.”
Potentially more exciting from a discovery point of view is Tower’s greenfield-stage, wholly-owned Baez gold-silver play, which lies 60 km southeast of Blackwater. Tower started staking a land package in the region in Nov. 2011, and the company now sits on roughly 400-sq.km. Leslie explains that the team reviewed regional geophysics and identified trending and structures in the area, and he subsequently spent a lot of time at the property in the summer prospecting.
“It really comes down to the technical team’s knowledge of that regional geology,” Leslie comments, explaining how paleo-ice directions factor into his regional models. “We had a bit of past drilling that was useful for us. What it identified was a large collapsed rhyolite dome and you can see the volcanic features there as well, which are key in pinning down those big epithermal gold plays. We had around five thousand geochemical samples and a lot of smoke here. It is a story that is evolving right now.”
Tower’s third asset is a 31-sq.km package located 65 km east of Kelowna, B.C. The Waterloo property lies in the historic Lightning Peak silver-gold camp, and saw sporadic production of high-grade silver over the past century. Leslie had been working to consolidate to the claims over the past few years, and Tower signed an earn-in agreement in Oct. 2011 that could see it hold a 100% stake in the project.
During 2011 fieldwork, Tower identified four untested targets, including grab samples averaging up to 2,700 grams silver per tonne. On Oct. 23 Tower started up a 1,000 metre program at Waterloo geared towards confirming historic silver mineralization, and gold mineralization lying 500 metres northeast of the past-producing mine site.
Tower maintains a tight equity structure with 28 million shares outstanding, and 45% insider ownership. The company reported US$1.6 million in cash at the end of August, and Vanry speculates that a low burn rate should see Tower end the year with around US$1.2 million. The company closed at 31.5¢ at time of writing and maintained a $8.9 million market capitalization.
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