Diamond Drilling Results Released from Kalum Gold Project
Cranbrook, BC; 15 December, 2008: Option partner Mountain Capital Inc. (TSX-V:MCI.P) has recently notified optionor Eagle Plains Resources (TSX-V:EPL) that final results have been received from an 11-hole, 1,390m diamond drilling program completed on the Kalum property in fall, 2008. The road-accessible, 20,762 ha property is located approximately 35 kilometres northwest of Terrace, British Columbia in the Skeena Mining Division of British Columbia.
- Hole HKM 08-01 returned 10.55m grading 0.973g/t gold from 9.95m to 20.50m, Including 0.3m which assayed 28.7 g/t gold from 20.20 to 20.50m
- Hole HKM 08-02 returned high-grade results of 59.60 g/t over .15m
- Hole HKM 08-03 returned 2.30m grading 11.949 g/t gold from 14.0-16.3m
MCI may earn a 60% interest in the property by making cash payments totaling $500,000, issuing 500,000 common shares and completing exploration expenditures of $4,000,000 over a period of five years. To date, MCI has made $25,000 in cash payments and issued 50,000 shares to EPL. The Property is subject to a 1% net smelter returns royalty in favour of a third party. MCI has indicated that the 2008 program was completed at a cost of $305,000.
The Property is centered upon a Cretaceous-age granodioritic stock of the Coast Crystalline Complex that has intruded Jurassic to Cretaceous-age sedimentary rocks of the Bowser Lake Group. A number of high-grade, vein-type gold occurrences are associated with the contact zone and magnetic signature of the intrusive stock. These occurrences have been explored by various operators and to various degrees over the past 80 years. All previous exploration efforts have been directed toward the discovery of high-grade stand-alone mineralization. The current Eagle Plains tenure represents the first time gold occurrences have been consolidated by a single company.
2008 Program Results
The initial phase of 2008 work included a 4.1 line km Induced Polarization geophysical survey and a detailed soil geochemical program to better define drill targets. Soil geochemical results indicated a weak correlation and expansion of anomalous gold in soil area indicated by previous Eagle Plains work. The I.P. survey was successful in defining an unexpected flat lying orientation to the targeted granodiorite intrusive that was known to host gold mineralization. Extremely high chargeabilities of up to 50 milliseconds reflected the pervasive disseminated and shear / quartz vein hosted pyrite content in the intrusive which is underlain by black argillite. The presence of widespread disseminated gold mineralization within the granodiorite intrusive was confirmed by diamond drilling.
2008 Drill Results
DDH’s KKM 08-07, 08-08, 08-09 intersected barren argillite lying beneath the granodiorite.
The 2008 exploration work program was under the supervision of J.W. Murton, P. Eng., a qualified person as defined by National Instrument 43-101 and a director of MCI.
Eagle Plains initiated property acquisition in the Kalum area in 2003 and completed significant exploration programs on the property in 2003 and 2004. The programs included a VTEM airborne survey, extensive geochemical programs, geologic mapping, and a 19 hole diamond drill program. In addition, many of the historical showings on the Property were located, sampled and surveyed. The program was successful in consolidating and evaluating all historic showings, discovering new high-grade Au-Ag occurrences, and developing new exploration models to help focus exploration in new directions.
About Eagle Plains
Eagle Plains’ management would like to take this opportunity to remind shareholders of the sound financial position of the company. The company currently has $6 million in cash and securities and is debt-free. Management has implemented a number of measures to protect its treasury and reduce overhead expenditures. The Company is in a strong position to take advantage of opportunities presented by the current economic downturn, and will be well-positioned when market conditions improve.
As part of its plans to diversify its activities during the current industry downturn, Eagle Plains provides competitively priced contract geological consulting services to both partners and third party clients, offering a full range of GIS, data management, data collection, and geological services as well as diamond drilling support.
Eagle Plains Resources continues to conduct research, acquire and explore metal projects in western Canada. The Company controls over 35 gold, base-metal and uranium projects, many with third parties including Teck Limited (TSX:TCK.B), Alexco Resource Corp. (TSX-V:AXR), Sandstorm Resources Ltd. (TSX-V:SSL.P), Waterloo Resources Ltd (TSX-V:WAT.P), Mountain Capital Inc (TSX-V:MCI.P) and XO Gold Resources Ltd. These agreements expose Eagle Plains to over $15.0 million in exploration expenditures over a five year period. In recent years, Eagle Plains has completed option agreements with Billiton Metals, Rio Algom Exploration, NovaGold Resources, Kennecott Exploration and numerous other junior exploration companies, resulting in over 52,000m (158,500’) of drilling and over $27.0 million in exploration spending on its projects since 1998. 2008 expenditures on Eagle Plains’ projects were approximately $6,000,000 in 2008, funded equally between Eagle Plains and third party partners. In 2009, management anticipates approximately $1.2 million in exploration expenditures funded by partners.
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.