Homestake Resource has announced that three holes out of five drilled during the phase I program conducted at the Homestake Ridge project’s South Reef deposit, intersected high-grade assays of gold.
The company has begun the phase II drill program, which was financed by Agnico Eagle Mines. As part of the 2012 preliminary drilling phase, Homestake completed 1248 m, totaling five holes, at the South Reef deposit.
Homestake has intersected 3.7 g/t silver and 11.4 g/t gold over 4.0 m in hole HR12-243; and 2.0 g/t silver and 5.89 g/t gold over 2.9 m, 4.54 g/t silver and 16.3 g/t gold over 0.5 m in hole HR12-240.
Recently drilled holes that offset three other holes drilled last year, which examined a strike of 75 m at the South Reef deposit and yielded high-grade gold. All three holes returned 3.3 g/t silver and 30.8 g/t gold over 3.1 m, including 1.6 g/t silver and 11.3 g/t gold over 8.7 m in hole HR11-232.
This year’s drilling has expanded the strike of the high-grade mineralized zone by about 100% that stays exposed in every direction. Mineralized gold is in line with strong chlorite-quartz alteration, minor base metal sulphides, and pyrite scattered along with pyrite-sericite alteration intervals. The company is waiting for assays from two holes.
Homestake has drilled six to eight holes during the phase II program. Under the terms of new option contract, Agnico-Eagle funded the $1.8 million-worth exploration campaign. The drilling campaign will examine a 600 m strike of the South Reef deposit trend, which contains a number of geophysical and hangingwall target areas. The program is expected to continue till mid-October.
The total budget for both 2012 phase I and II program is $2.5 million. Agnico-Eagle can earn 52% interest in the Homestake Ridge project by spending $8.5 million additionally by 31 December, 2014, and will earn 65% by spending $25.3 million by 2016. Homestake Resources will be the project operator for this season.