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Klondex Mines Reveals Over 132 G/T Gold Grade Average For Joyce Vein Sampling At Fire Creek

Jul. 10, 2013 11:28 AM ET
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Klondex Mines (TSE:KDX) (OTCQX:KLNDF) has unveiled further results from sampling at its Fire Creek project in Nevada, showing grade averages of over 132 grams per tonne (g/t) gold at the Joyce vein on the site.

The company, which is gearing up for initial production at the project later this year, told investors Wednesday that the weighted average grade of samples from the structure is 132.8 g/t gold along 144.2 metres of strike, with an average width of 0.6 metres. The result is for 94 face samples ranging from 1.4 g/t to a whopping 30,228.7 g/t gold.

Channel samples were taken from north and south of the 5370 and 5400 crosscuts at the site. The company said that it has now completed over 144 metres of exploration development on the Joyce structure, with previous drilling by Klondex showing that mineralization extends beyond the current boundaries - both along strike and at depth.

"We are obviously very pleased with the results and the valuable perspective the data provides," said the project's general manager, Mike Doolin. "Not only do these results confirm the continuity of the mineralization along strike, but they also demonstrate the overall grade consistency within the Joyce Structure."

Last month, the gold development company returned channel sampling results as high as 22,396 grams per tonne (g/t) of gold 74 feet north of the 5400 cross cut from its Vonnie vein. It also returned 20,231 g/t gold 63 feet north of the 5400 cross cut, and 15,891 g/t gold 69 feet north. The high grade mineralization was found during a program that was designed to follow up on a surface drill intercept that returned 2,910 g/t gold over 1.5 metres last September.

Klondex is working hard at having the next new producing asset in Nevada, with the company having the advantage of grade on its side, according to CEO Paul Huet, who made the assurance to investors at the company's annual general meeting in June.

The Fire Creek project is situated at the intersection of the Battle Mountain trend and Northern Nevada Rift, which also hosts the Midas and Hollister narrow-vein epithermal gold deposits. The company is planning to start initial production from bulk sampling later this year, with an updated resource from drilling due this summer, to be followed by a new and comprehensive mine plan.

"The Fire Creek project is an amazing asset. We have the advantage of grade. It's a high class, simple asset that demonstrates some of the best grades you're going to see in the world," said Huet, who came on board at Klondex late last year, making his appearance at the meeting last month his first presentation to investors.

Shares of Klondex closed Tuesday at $1.17 in Toronto, giving the company a market cap of $75.4 million.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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