Otis Seeks USFS Permit to Build New Roads at Kilgore Gold Project

Otis Gold Corp. ("Otis" or the "Company") is in the process of obtaining a permit from the United States Forest Service ("USFS") to build approximately 1,200 metres (m) of new roads at the Kilgore Gold Project, located in the Caribou Targhee National Forest, Clark County, Idaho. These roads will be used to perform additional drilling to extend beyond the northern limit of the established Kilgore Gold Deposit (or "Kilgore Deposit") where Otis has drilled open-ended +100 m-thick core and RC (reverse circulation) intercepts on the edge of the current drill pattern.

Intercepts to be offset include two 2011 core holes with 114 and 118 m @ 0.89 g/t Au (see Otis News Release dated October 6, 2011) and three 2012 RC holes with 82.3 m of 0.95 g/t Au, 121.9 m of 1.04 g/t Au, that includes 45.7 m of 1.52 g/t Au, and 83.8 m of 1.12 g/t Au, that includes 30.5 m of 2.10 g/t Au (see Otis News Release dated January 17, 2013).

In the spring of 2013, Otis submitted a Plan of Operation to the USFS to build new access roads to conduct up to a 7,000 m drill program from twelve drill sites and extend the current Kilgore Deposit at least 400 m beyond its current northern limit into an area characterized by a continuous gold-in-soil anomaly along strike of the suspected feeder structure. This program is necessary to determine the entire extent of the existing Kilgore Deposit in order to prepare a future Preliminary Economic Assessment.

In 2014, and subject to the receipt of the aforementioned permit and adequate financing, Otis intends to conduct the following activities: (1) construction and maintenance of exploration roads sumps and drill sites, (2) up to 7,000m of RC and, possibly, core drilling, (3) geologic mapping and bulk sampling of the newly constructed roads, and (4) establishing ground water monitoring well(s). The combined surface disturbance will be approximately 1.8 acres.

After the Plan of Operation was submitted, as required under the National Environmental Policy Act, the USFS conducted an extended public comment and review period regarding the proposed plan. Three parties submitted comments and have established standing to file an objection, whereby only parties with standing can object to the decision. In mid-June, 10 members of the USFS interdisciplinary ("ID") team walked the planned road course and analyzed the potential consequences of the proposed road construction. In their reports they concluded an Environmental Assessment ("EA") is sufficient to address issues surrounding erosion control, soils, cultural resources, paleontological resources, wildlife, vegetation, groundwater, road engineering, recreation and access.

The USFS has received all comments from its ID team, has solicited additional information from Otis and is in the process of preparing the EA. The first draft of the EA is expected to be completed by early January and, barring any unforeseen delays, Otis believes a permit may be issued by the beginning of the 2014 drill season. In order to assist the USFS, Otis geologists have initiated a one-year baseline study to characterize the nature and chemistry of the groundwater in the deposit area. Three months of data have already been collected from surface and well sites surrounding the project area to assist in the preparation of the EA; the complete one year study will be used for future permitting purposes.

About the Kilgore Gold Deposit

The caldera-related Kilgore Gold Deposit is located within the Company's Kilgore Gold Project, Clark County, Idaho. The Kilgore Gold Project is 5,130 acres in size, is 100% owned by Otis, and is subject to no underlying royalties.

The Kilgore Gold Deposit contains a NI 43-101 Indicated Resource of 520,000 oz Au in 27.4 million tonnes at a grade of 0.59 g/t Au and an Inferred Resource of 300,000 oz Au in 20.2 million tonnes at a grade of 0.46 g/t Au. The deposit constitutes the continuous and contiguous Prospect Ridge, Mine Ridge and North Target areas, all referred to in prior Company news releases. The Kilgore Gold Deposit is a zoned low-sulfidation quartz-adularia epithermal hot-spring system hosted in volcanic rocks of Late Miocene age. Gold mineralization is of the classic disseminated, bulk-tonnage type similar to that comprising the classic and world-class size volcanic-hosted gold deposits at Round Mountain, Nevada and McDonald Meadows, Montana. K-Ar age determination on hydrothermal adularia tentatively dates mineralization at 5.3 Ma (Late Miocene). Gold mineralization is mostly controlled by a major northwest-trending structural zone, the Northwest Fault, and is closely associated with a series or set of northwest-trending, high-angle, en echelon rhyolitic to intermediate dikes and dike swarms. Additional host rock enclosing the dikes and sills and serving to contain a major portion of the deposit mineralization is a porous and permeable, ashy and rhyolitic lithic tuff unit. Further, sedimentary host-rock material containing a portion of the mineralization comprises basement sandstone and siltstone of the Aspen Formation of Cretaceous age.

About the Company

Otis is a resource company focused on the acquisition, exploration, and development of precious metal deposits in Idaho, USA. Otis is currently developing its flagship property, the Kilgore Gold Project, located in Clark County, Idaho.


Craig T. Lindsay, President and CEO

Source: http://www.otisgold.com/


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