Sage Gold holds an option to acquire a 60% interest in the Clavos Mine from St. Andrew Goldfields (TSE:SAS). Clavos is fully permitted for gold mining with a total of $72 million invested in capital improvements and underground development. Existing infrastructure includes underground ramp access to the 300 meter level, underground levels developed every 25 meters, power to the site, along with surface ventilation and water management systems, and the project is located 10 kilometers from the Brigus Gold Mill in Stock Township.
The Timmins gold camp is part of a much larger greenstone gold belt that has produced over 180 million ounces of gold and is part of the most productive gold belt in Canada, and third highest producer of gold in the world.
The gold camp has been in continuous production since 1910 when the Dome Mine was established with 18.5 million ounces of gold at 6.23 g/t Au, and the Hollinger-McIntyre Mine with 32.1 million ounces at 9.76 g/t Au that closed in 1989. Other major long life producers include the Pamour-Hallnor-Hoyle Mine with 7.5 million ounces, Buffalo Ankerite-Aunor-Delnite with 4.5 million ounces, and the Goldcorp (TSE:G)-owned Hoyle Pond Mine, with 2.5 million ounces that is located only 20 kilometers from Clavos.
St Andrew Goldfields completed an evaluation for the entire Clavos property in 2003 and estimated an Indicated Resource of 753,000 tonnes at 7.3 g/t Au for 177,000 ounces, and an Inferred Resource of 452,000 tonnes at 8.3 g/t Au for 129,000 ounces of gold.
This was updated in 2006 for the Clavos Mine, and was independently verified by Roscoe Postle & Associates for a Measured and Indicated Resource of 143,000 tonnes at 8.0 g/t Au containing 37,000 ounces, and an additional Inferred Resource of 529,000 tonnes at 6.5 g/t Au for 110,000 ounces of gold.
Sage is required by the joint venture terms to commit $3 million in exploration costs and pay $200,000 in cash and shares, and has already spent $2.8 million in this effort.
The Clavos property covers 2,540 hectares and is located north of the Pipestone Fault. There are four mineralized zones on the property known as the Hangingwall, Footwall, Contact and Porphyry Zones, and these zones carry two styles of quartz veins that include early grey quartz veins, and quartz extension veins that include sigmoidal extension vein arrays, and associated shear veins.
Sage has already completed 7,750 meters of fresh drilling in 2011 that identified a number of new gold resources. The company is also completing the first deposit model at Clavos that incorporates over 150,000 meters of historical surface drilling, and 40,000 meters of historic underground drilling, in an effort to identify potential extensions and targets for ongoing drilling programs.
The current drilling program is already having considerable success in confirming previously defined resources and outlining new gold resources. Drilling has extended the horizontal strike by at least 700 meters east of the Clavos Mine, and 75 to 150 meters below the deepest defined resources at the central and eastern end of the underground workings.
Drill hole CL-11-22 tested above existing stopes on the 150 level, intersecting three intervals of mineralization between 124.4 - 152.0 meters for 8.3 meters at 2.16 g/t Au, 0.7 meters at 8.3 g/t Au and 6.4 meters at 1.58 g/t Au.
CL-11-25 intersected five intervals between 75.7 - 131.0 meters for 4.2 meters at 0.69 g/t Au, 2.3 meters at 1.04 g/t Au, 13.2 meters at 1.52 g/t Au, and 4.6 meters at 17.11 g/t Au, which included 1.1 meters at 63.74 g/t Au.
CL-11-24 tested the stopes above the 100 level and intersected three intervals between 53.9 - 59.7 meters for 1.1 meters at 2.31 g/t Au, 7.5 meters at 2.51 g/t Au, and 0.7 meters at 15.55 g/t Au, and confirmed the presence of continuous high grade mineralization above existing stopes.
CL-11-15 tested the down plunge on the alteration zone between 391.0 - 451 meters and encountered five intersections of 1.6 meters at 0.83 g/t Au, 2 meters at 1.01 g/t Au, 1.0 meters at 6.74 g/t Au, 2.1 meters at 0.82 g/t Au, and 1.0 meter at 13.6 g/t Au.
CL-11-16 tested the alteration zone 150 meters down plunge from the eastern end of the underground workings and at 406.3 meters intersected 0.7 meters at 2.75 g/t Au, and 0.8 meters at 18.5 g/t Au at 436.0 meters.
Meanwhile, CL-11-20 tested 150 meters vertically below the central workings, and 75 meters below previously defined resource blocks and intersected 2.25 meters at 4.91 g/t Au at 433.85 meters, and 1.0 meters at 9.31 g/t Au at 420.5 meters.
CL-11-14 and CL-11-31 tested the upper portion of the 960 Zone at distances of 670 and 700 meters east of the Clavos Mine, and intersected five intervals between 97.1 - 221.0 meters ranging from 0.3 -4.35 meters in width and carrying gold values of between 1.06 - 3.23 g/t Au.
CL-11-07, CL-11-11 and CL-11-13, which were sited 600 meters east of Clavos, saw multiple high grade intersections, which included highlights of 0.5 meters at 6.86 g/t Au at 52.5 meters, 6.3 meters at 8.08 g/t Au at 120.5 meters, 1.4 meters at 9.33 g/t Au at 99.8 meters, 0.7 meters at 10.85 g/t Au at 168.5 meters, 1.8 meters at 5.48 g/t Au at 160.5 meters, and 0.85 meters at 8.32 g/t Au at 170.0 meters.
Sage is working towards the completion of a Preliminary Economic Assessment and a NI 43-101 compliant resource update by the end of the first quarter of 2012, and is negotiating for funding to bring the Clavos Mine back into production in 2013.
A joint venture has been established with MetalCorp (CVE:MTC) (OTC:MTLCF) allowing the partner to acquire a 70% interest in the Solomon's Pillars Project on the Beardmore-Geraldton Greenstone belt. This belt has produced four million ounces of gold and includes the nearby Leitch Mine, which produced 861,982 ounces at 28.5 g/t Au per tonne, and is known as one of the richest gold producers in Canada.
Historical work at Solomon's Pillar's completed in the 1970's defined a non compliant resource of 90,718 tonnes at 8.6 g/t Au in the area of a shaft that was sunk to a depth of 91.4 meters. Additional historic exploration work indicated the presence of a mineralized trend that is open in all directions.
Sage maintains an extensive portfolio of properties within this mining camp, which includes the Lynx Deposit with an Inferred Resource of 1.936 million tonnes grading 1.45% Cu, 39.1 g/t Ag and 0.58 g/t Au and is part of a highly prospective 87,000 acre land position.
The company intends to maintain a primary focus on the redevelopment of the Clavos Mine and become a significant Canadian gold producer over the next five years.