NovaGold To Drill Eagle Plains’ McQuesten Gold Property, Yukon

Cranbrook, B.C.: Eagle Plains Resources Ltd. (EPL:CDNX) and NovaGold Resources Inc. (NRI:TSE) announced today that their option agreement on the McQuesten Gold Property has been amended to include a major drilling commitment. Eagle Plains has 100% interest (less 2% NSR) in the property located in the Keno Hill Mining District, 40 kilometres northeast of Mayo, Yukon. McQuesten consists of 51 quartz mining claims (2500 acres) that are accessed by the all-weather Yukon Silver Trail highway with an adjacent hydro-electric transmission line. The of Elsa is located 5km to the north.

In 1999 NovaGold purchased (from Viceroy Exploration Ltd. (VOY:TSE) the right to earn a 70% interest in the property from Eagle Plains by making exploration expenditures of C$1,000,000 on the property and assuming cash payments totalling C$320,000. To date all cash payments relating to the option agreement have been settled. The completion of a 10,000-foot drill program will fulfil the C$1,000,000 expenditure requirement whereby NovaGold will earn its 70% interest and enter into a joint-venture agreement with Eagle Plains.

Drilling and trenching on the McQuesten property indicates the presence of a large mineralized system hosted within calcareous meta-sediments and intrusive rocks. Mineralization consists of disseminated and semi-massive sulphides (pyrrhotite, pyrite and arsenopyrite) in quartz-sericite and skarn alteration packages of sedimentary rocks. Felsic sills and dikes intrude along a low angle shear zone. Two major zones have been identified in the McQuesten Mineralized Structural Zone: the West and East Zones.

Drill holes in the West Zone contain up to 18.3 m of 3.74 g/t and 24.4 m of 2.16 g/t Au. Trenches include 16.0 m of 2.67 g/t and 27.0 m of 1.62 g/t Au. Drill holes in the East Zone contain up to 16.3 m of 2.19 g/t and 9.6 m of 2.87 g/t Au. Trenches include 9.2 m of 4.94 g/t and 8.3 m of 2.72 g/t Au. Both zones remain open along strike. The accompanying tables summarize the significant drill and trench intervals to date.

Induced polarization geophysical surveys reveal additional untested anomalies outside of the currently defined East and West Zones. Ground and airborne magnetic data suggest that the East Zone and Southeast Anomaly are part of a mineralized trend: the McQuesten Mineralized Structural Zone that is continuous for over 3 kilometers in strike length.

Bottle-roll leach tests on unoxidized drill core recovered up to 84.3% of the gold indicating that the ores are not refractory and therefore amenable to conventional cyanidation processing methods.

Highlights of significant drill and trench results - McQuesten West Zone

DH/TR_ID From (m) To (m) Length (m) Au g/t Length (ft) Au oz/t
D-W8102 18.0 22.6 4.6 3.13 15 0.09
D-W8103 6.5 18.3 11.8 3.52 39 0.10
D-W8104 50.6 53.8 3.2 6.55 10 0.19
and 33.7 37.8 4.2 2.22 14 0.06
D-W8107 18.3 21.6 3.3 2.07 11 0.06
and 49.9 52.7 2.8 2.76 9 0.08
and 87.9 92.4 4.5 8.17 15 0.24
D-W8108 46.0 55.5 9.5 2.17 31 0.06
D-W8109 49.5 55.5 6.0 3.85 20 0.11
D-W8114 22.4 25.0 2.6 2.34 9 0.07
RC9702 11.0 35.4 24.4 2.16 80 0.06
RC9703 9.1 27.4 18.3 3.74 60 0.11
RC9706 86.3 92.4 6.1 3.12 20 0.09
TR9701 28.0 44.0 16.0 2.67 52 0.08
TR9703 8.0 35.0 27.0 1.62 89 0.05

Highlights of significant drill and trench results - McQuesten East Zone

DH/TR_ID From (m) To (m) Length (m) Au g/t Length (ft) Au oz/t
D-8301 100.6 110.2 9.6 2.87 31 0.08
D-8306 94.3 110.6 16.3 2.19 53 0.06
TR9805 54.0 58.0 4.0 7.64 13 0.22
TR9806 107.0 107.5 0.5 10.00 2 0.29
TR9810 81.8 91.0 9.2 4.94 30 0.14
and 60.0 64.0 4.0 2.32 13 0.07
and 61.7 70.0 8.3 2.72 27 0.08

 

On behalf of the Board of Directors

Signed

“Tim J. Termuende”
President and CEO

For further information on EPL, please contact Mike Labach at 1 866 HUNT ORE (486 8673)
Email: mgl@eagleplains.com or visit our website at http://www.eagleplains.com

 

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.