Eagle Plains Receives $1,000,000 Share Payment for Copper Canyon
Cranbrook, B.C., 01 March, 2006: Eagle Plains Resources Ltd (TSX-V:EPL) has received the third of four annual share issuances from NovaGold Resources Inc. (AMEX, TSX:NG) as required under the Copper Canyon Option Agreement. A total of 74,074 NG shares were received, with a market value at close of trading on February 24th $1,086,665.
NovaGold may earn a 60% interest in the Copper Canyon project from EPL by completing C$3 million in exploration expenditures, issuing a total of 296,000 shares of NovaGold and making property payments totaling C$250,000. NovaGold may earn an additional 20% interest in the project for a total of 80% by paying Eagle Plains C$1 million and completing a feasibility study by September 2011.
An inferred category resource estimate completed by independent engineering firm Hatch Ltd. of Vancouver, B.C., Canada, shows that the Copper Canyon target at the Galore Creek project in Northwestern British Columbia contains over 2.86 million ounces of gold, 37.9 million ounces of silver and 1.16 billion pounds of copper at a 0.35% copper equivalent cut-off grade (CuEq)(1) (See Table 1 below). Copper Equivalent grades are based both on long-term average metal prices and estimated recoveries based on extensive metallurgical data from the adjacent Galore Creek Central/SW deposit. The estimate utilized a geologic model developed from the previously announced drilling at Copper Canyon during 2004 by NovaGold and historic results which had encountered significant widths of gold, silver and copper mineralization.
Table 1 : COPPER CANYON TARGET - INFERRED RESOURCE
|Cutoff||Size||Grade||Million lbs.||Million Ozs||Million Ozs|
Note: (1) Copper equivalent calculations use metal prices of US$375/oz for gold, US$5.50/oz for silver and US$0.90/lb for copper. Copper equivalent calculations (CuEq%) reflect gross metal content that have been adjusted for metallurgical recoveries based on the following criteria: Copper Recovery = (%Cu-0.06)/%Cu with a minimum of 50% and Maximum of 95%; Gold Recovery = (Au g/t – 0.14)/Au g/t with a minimum of 30% and Maximum of 80%; and Silver Recovery = 80%.
The results from 2004 drilling at Copper Canyon, combined with the earlier results, have defined a broad area of precious metal rich mineralization at least 700 meters by 400 meters which is open to expansion. The mineralization begins at surface continuing to as much as 300 meters depth and occurs as a roughly 100+ meter thick zone of disseminated chalcopyrite and pyrite hosted within an intrusive porphyry complex.
During September, 2005, three holes were drilled for a total of 924.23m; results of the drill program were as follows:
|Hole ID||From||To||Assayed Length (m)||CuEq*%||Cu %||Au (g/T)||Ag (g/T)|
|CC05-0031||0||287.8||266.7||No significant results|
|GC05-0659||0||195.0||194.0||No significant results|
The focus of the 2005 program was to “extend the presence of high-grade copper and gold mineralization within the Copper Canyon deposit as well as identify the cause of a local magnetic high and chargeability anomaly located in the East Fork Galore Creek valley within the Copper Canyon claims”. It is anticipated that the 2005 drill holes will not materially affect the current Inferred Resource calculation.
Hole CC05-0030 was to test northward limit of mineralization defined in holes CC04-023 and 025 while CC05-0031 tested for mineralization continuity at depth in the area near CC90-004. GC05-0659 was drilled vertically to test an Induced Polarization chargeability anomaly interpreted to lie at 150m depth.
Results from CC05-0030 confirmed that mineralization within the Copper Canyon Deposit continues to the north. CC05-0031 did not intersect any significant mineralization and was terminated due to stuck rods within a possible fault. No significant copper mineralization and/or potassic alteration similar to that at Galore Creek and the main Copper Canyon deposit was observed within drill core of hole GC05-0659.
Work proposed for 2006 includes additional drilling and surface mapping in order to provide closer spaced subsurface data within the area of the known Cu-Au-Ag resource and to explore the exterior limits of mineralization.
The 2005 drill program and sampling protocol was completed with oversight by qualified person Scott Petsel, Senior Project Geologist for NovaGold. A rigorous quality control and quality assurance protocol was utilized on the project including blank and reference samples with each batch of assays. All drill samples were analyzed by fire assay at ALS Chemex Labs in Vancouver, B.C., Canada.
Eagle Plains announced September 26th a proposed arrangement to spin-off its Copper Canyon, Abo and Severance properties in an effort to maximize shareholder value by improving their identification, simplifying ownership and selectively reducing stock dilution. The new company, Copper Canyon Resources Ltd. ("Copper Canyon") will apply to have its shares listed on the TSX Venture Exchange. The split is subject to shareholder approval by not less than 66 2/3% of the votes to be cast at the Annual & Special General Meeting, now projected for mid-May, with final Court and Exchange approval anticipated in late May. The Share Distribution Record Date, which will determine those Eagle Plains shareholders who are to receive shares in Copper Canyon Resources on a one-for-one basis, is now projected for mid-April. The exact dates will be announced as soon as they are available.
Eagle Plains Resources continues to conduct research, acquisition and exploration projects in western Canada. The Company controls over 35 gold and base metal projects, many with third parties including NovaGold Inc. (AMEX,TSX:NG), Northern Continental Resources Inc. (TSX-V:NCR), and Golden Cariboo Resources Inc. (TSX-V:GCC). These agreements expose Eagle Plains to over $8,000,000 in exploration expenditures over the next five years. In recent years, Eagle Plains has completed option agreements with Billiton Metals, Rio Algom Exploration, Kennecott Exploration, Viceroy Resource Corp. and numerous other junior exploration companies, resulting in over 30,000m (100,000’) of drilling and over $9,000,000 in exploration spending on its projects since 1998. During the 2005 season, EPL and its partners completed over 11,900m (39,000’) of diamond drilling on EPL properties.
This news release has been reviewed and approved by Tim J. Termuende, P.Geo., hereby designated as a “Qualified Person” under National Instrument 43-101.
On behalf of the Board of Directors
“Tim J. Termuende”
President and CEO
Cautionary Note Regarding Forward-Looking Statements
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.