The Erickson Ridge Project is located in the greater Elk City mining district of north-central Idaho which has produced more than one million ounces of gold, dominantly from placer operations1, and hosts several known historic resources including at Endomines Inc’s Friday mine, currently in production. In April 2020 EMX has executed an option agreement for the Erickson Ridge gold project in Idaho with Gold Lion Resources (NV) Inc., a subsidiary of Gold Lion Resources Inc. (CSE: GL; FWB: 2BC) (“Gold Lion”). The Agreements provide for share and cash payments to EMX, as well as work commitments during Gold Lion’s earn-in period for each given Project, and upon earn-in, a 3.5% net smelter return (“NSR”) royalty, annual advanced royalty payments, and milestone payments. See Company news release dated April 7, 2020 for more details.
The Erickson Ridge Project covers the northern extension of the regionally important Orogrande Shear Zone in the Elk City mining district, which hosts multiple historic resources. Within the Project area, the shear zone is mantled by soil and vegetation with widespread placer gold occurrences. The Project contains a 1980s-era historic resource, which also corresponds with an EMX gold-in-soil anomaly that extends mineralization more than one kilometer along strike beyond the historic resource footprint. Drill intercepts from the 1980s work include 33.5 meters @ 4.1 g/t gold (hole ER-84-13 from 16.8m to 50.3m) and 21.3 meters @ 3.15 g/t gold (hole ER-84-23 from 77.7 to 99.0m) (disseminated-style mineralization, true thicknesses unknown)2.
The historic exploration was focused on shallow oxide gold mineralization, with drill holes typically less than 100 meters in depth (see reference2). Modern exploration has not been conducted over much of the Project area, and EMX has targeted extensions of the historic resource area in addition to structural intersections along strike of the Orogrande Shear zone.
The Friday deposit’s lower grade, open pit constrained historic resource from 2013 (see reference3) was based upon US$1500/oz gold and 85% recovery applied to an inverse distance interpolated block model. A more recent historic resource focused on a higher grade, underground scenario at a 3.4 g/t gold cutoff that yielded measured and indicated resources of 462 Ktonnes @ 6.54 g/t Au (containing 97,200 oz Au) and inferred resources of 296 Ktonnes @ 4.91 g/t Au (containing 47,600 oz Au) which was based upon US$1300/oz gold and 94% recovery applied to an inverse distance interpolated block model4. EMX cannot verify the 2013 or 2017 historic resources, and a qualified person has not done sufficient work to classify the historic resources as current mineral resources. EMX is not treating the historic estimates as current mineral resources. It is EMX’s opinion that both the open pit and underground historic resources could be brought current with updated metal prices, cost estimates, and process recoveries, as well as confirmation drilling. An important step forward for Endomines to update the open pit resource was its acquisition of the open pit mining rights in late 20195.
The adjacent and nearby historic resources, deposits and mines referenced provide geologic context for the Projects, but this is not necessarily indicative that the Projects host similar tonnages or grades of mineralization. Based upon EMX’s independent field work, including geologic mapping and surface sampling, the historic resources and exploration results referenced are considered to be reliable and relevant.
1 Greater Elk City District Production: USGS: Koschmann and Bergendahl, 1968. Principal Gold Producing Districts of the United States. Professional Paper 610.
2 Internal drill sections from Erickson Reef Project, Idaho County, Idaho. 1985. United Gold Corp.
3 NI 43-101 Technical Report, Idaho Gold Project. Prepared by Geosim for Premium Exploration Inc. 4/8/13.
4 See Endomines news release dated March 3, 2020 and Independent Expert’s Report from AMC Consultants to Endomines AB dated January 8, 2018.
5 See Endomines news release dated December 3, 2019.