Eagle Plains/Shoshone Silver Execute Formal Agreement on Blende Property, Acquire Additional Claims
Cranbrook, B.C. 11 May, 2004: Eagle Plains Resources Ltd. (EPL:TSX-V) announces that it has executed a formal option agreement with Shoshone Silver Mining Co.. (SHSH:OTC) whereby Shoshone may earn a 60% interest from EPL in the Blende silver/base-metal deposit located in the Wernecke Mountains, approximately 65 NE of Keno in central Yukon Territory. The property is currently owned 100% by EPL (subject to a 1% NSR), and originally consisted of 16 quartz claims covering approximately 800 acres. Subsequent to completion of the formal agreement, EPL and SHSH have completed staking of an additional 46 units, for a total project area of 62 units (3100 acres).
Shoshone has paid to EPL $US 25,000 cash and issued 100,000 common shares. To complete its earn-in, SHSH will carry out $US 5,000,000 in exploration expenditures ($US 100,000 during 2004) and issue a total of 1,000,000 voting-class common shares to EPL by December 31st, 2008. EPL will remain operator of the project up to the completion of $US 800,000 in expenditures. A 10% finders fee has been reserved for B. Kreft, and will be paid by the vendor.
The Blende is a carbonate-hosted deposit on the south edge of the Mackenzie Platform, hosted by Middle Proterozoic Gillespie Group dolomite. Based on exploration work completed by Billiton Metals Canada to the end of 1991, a drill-indicated resource was reported of 19.4 million tonnes grading 55.9 g/t silver and 5.85 % lead-zinc, located in two zones (though these estimates are considered by Eagle Plains and Shoshone management to be relevant, they were prepared prior to the institution of National Instrument 43-101 standards. Their reliability has not been confirmed, but will constitute a target basis for future exploration work).
On surface, the deposit is outlined by an open-ended 4.8km-long soil anomaly which contains values up to 10,000 ppm Zn. Most geophysical methods including IP, VLF and Max-Min EM work exceptionally well due to the inert nature of the host dolomite. Diamond-drilling carried out in 1991 delineated two separate zones (East Zone and West Zone), and established that the deposit is non-acid generating and could be mined by open pit methods, with a stripping ratio of 2.1:1. The deposit consists of a near-surface steeply dipping tabular body which is conveniently located on a ridge crest. Preliminary metallurgical studies indicated no significant concentrations of deleterious elements.
Although initially explored as an open-pit target, management of Eagle Plains and Shoshone feel that there is good potential to develop the property as an underground operation. Numerous high-grade intersections have been reported by past operators, including hole 88-02 which assayed 282 g/t (8.22 oz/t) silver, 12.2% lead, and 4.4% zinc over 19.8m from a depth of 70.7 to 90.5m. Hole 88-03 returned 8.5m grading 550.1 g/t (16.04 oz/t) silver, 15.3% lead and 4.6 % zinc from 118.0 to 126.5m, and hole 90-15 intersected 9.5m grading 351.2 g/t (10.24 oz/t) silver, 14.11% lead, and 6.59% zinc from 60.1 to 69.6m. Step-out drilling in 1994 confirmed the continuation of ore-grade mineralization westward, with the addition of significant copper values. Hole 94-81 contained 14.9 m of mineralization which assayed 228.4 g/t (6.66 oz/t) silver, 9.71% lead, 5.48% zinc, and 0.78% copper from 9.2m to 24.1m, while hole 94-84 intersected 8.5m which returned 136.1g/t (3.97 oz/t) silver, 6.74% lead, 3.65% zinc, and 2.43% copper from 45.5-54.0m.
Mineralization at the Blende was originally noted by the Geological Survey of Canada in 1961 and was first staked in 1975 by Cyprus Anvil Mining Corp., which carried out mapping and geochemical sampling later in the year. Archer Cathro & Associates (1981) Ltd. restaked the property in April 1981 and conducted trenching and rock sampling from 1981 to 1984. NDU Resources Ltd. purchased the property in 1987, and in 1988 drilled 3 holes (718 m) and explored by mapping and hand trenching. In 1989 NDU carried out mapping, road construction, soil sampling, magnetic and VLF-EM surveys. Billiton optioned the property in 1989 and as project operator drilled 15 holes (3659.7 m) in 1990. Billiton’s 1991 work included completion of the soil geochemical and geophysical coverage, drill-testing of the deposit over a 3.3 km strike length, and preliminary metallurgical tests. The 1991 drilling consisted of 62 holes totaling 11,525m, including 15 holes in the West Zone, 34 holes in the East Zone and 13 holes in the central area between the two zones. Billiton elected in 1993 to convert its interest to a 10% net profits royalty. In 1994 NDU drilled 7 step-out holes (596m) which successfully extended the West Zone 150m further westward (the West Zone remains open in this direction). This activity is the last recorded exploration of the property. In March, 1998 NDU merged with United Keno Hill Mines Ltd. (UKHM) and the property came under the control of UKHM, which subsequently went into receivership. Eagle Plains consultants in Whitehorse commenced staking in January, 2001, immediately after the original claims expired.
EPL and SHSH intend to conduct a detailed validation, compilation and re-evaluation of the historical data and design a program for future exploration and development that will conform to National Instrument 43-101 standards.
Eagle Plains Resources continues to conduct research, acquisition and exploration projects in western Canada. Through a network of prospectors, consultants and experienced contractors in addition to seasoned employees and a well-rounded Board of Directors, the Company has assembled a diverse portfolio of over 30 gold and base-metal properties. EPL seeks to attract joint-venture participation on its properties, thereby leveraging exploration spending to the ultimate benefit of the Company’s shareholders. In recent years, Eagle Plains has completed option agreements with Billiton Exploration Canada Ltd., Rio Algom Exploration Inc., Kennecott Canada Exploration Inc., NovaGold/SpectrumGold Inc., Viceroy Resource Corp. and numerous other junior exploration companies, resulting in nearly 10,000m (33,000’) of drilling and over $5,000,000 in exploration spending on its properties since 1998.
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.