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Mountain Lake releases latest holes from Leprechaun, shows promise for upcoming estimate

Mountain Lake Resources (CVE:MOA) announced Thursday the latest drill results from the Leprechaun deposit, part of the joint venture Valentine Lake gold property in central Newfoundland, showing good potential for the upcoming new resource estimate.

The company, along with its 50/50 joint venture partner Marathon Gold (TSE:MOZ), received results from eight holes, including 5.99 grams per tonne (g/t) of gold over 10.8 metres in hole VL-11-345, which hosts 28.88 g/t gold over 1.8 metres.

Results are still pending on the final 22 of 145 resource expansion holes completed at the Leprechaun deposit in 2011, with the program now completed, the companies said.

Other notable results released today include 3.69 g/t gold over 12.4 metres, including 39.8 g/t gold over 1.0 metre in hole VL-11-343; and 3.34 g/t gold over 9.0 metres, including 9.52 g/t gold over 2.7 metres in VL-11-344.

“Good lateral continuity between high-grade intercepts within the high-grade shoots of the Leprechaun Deposit continues to be demonstrated and this will have a positive impact on the upcoming new resource estimate," said president and CEO of Mountain Lake, Gary Woods.

Mountain Lake said the new Hanging Wall Zone reported in early October continues to expand with new mineralization intersected in drill holes VL-11-345 with 6.53 g/t gold over 2.6 metres, hole VL-11-347 with 4.41 g/t gold over 2.9 metres, and hole VL-11-343 with 2.15 g/t gold over 2.9 metres.
In addition, significant new Footwall Zone intercepts reported include 5.73 g/t gold over 2.4 metres with 17.09 g/t gold over 0.8 metres in hole VL-11-353, and 3.20 g/t gold over 2.8 metres in hole VL-11-355.

"The remaining 2011 drilling will focus on initial testing of the newly discovered J. Frank Zone and hanging wall mineralization where coarse visible gold has been exposed, as well as the underlying structurally equivalent setting to the Main Zone at the Leprechaun Deposit," added Woods.

Indeed, Mountain Lake said drill rigs have now been moved 1.5 kilometres southwest along strike to conduct initial drill testing of the newly discovered J. Frank Zone, where bedrock grab samples from trenching returned gold values from less tha 5 parts per billion (ppb) gold to up to 581,875 ppb, or 581.88 g/t.

The Valentine Lake Property is a 50/50 joint venture between Marathon Gold and Mountain Lake with the Leprechaun deposit situated at the south-western end of a 23 kilometre long, gold-bearing mineralized corridor. Marathon is the operator of the project, with both partners having jointly funded a $7.1 million resource expansion and exploration program in 2011, which has now been completed.

This year, 24,938 metres were drilled at the Leprechaun deposit, and an updated resource estimate is due out before year-end.

Currently, the deposit has an NI 43-101 compliant measured and indicated resource of 3.28 million tonnes grading 2.62 g/t gold for a total estimated 277,000 ounces of gold, and an associated inferred resource of 4.4 million tonnes grading 2.01 g/t gold for an estimated 285,000 ounces of gold. The 2010 resource was estimated using a 0.5 g/t gold minimum cut-off over a 3 metre minimum width.