LAKEWOOD, Colo., Sept. 17, 2012 (GLOBE NEWSWIRE) -- Pershing Gold Corporation (OTCBB:PGLC) is pleased to provide this update of the many achievements realized in its first year of owning the Relief Canyon Mine property in Pershing County, Nevada. Since acquiring this property out of bankruptcy in August 2011, Pershing Gold (formerly known as Sagebrush Gold Ltd.) is well on its way to putting this long-neglected gold mine into production. Additionally, the Company is conducting an aggressive exploration program that has already found new mineralized zones outside of the existing open-pit mine that are expected to substantially increase the mineral resource. As a result of this exploration work, Pershing Gold's geologists have developed a new exploration model focused on three styles of mineralization. This refined understanding of the geology of the Relief Canyon ore deposit has identified a number of high-priority targets that are the focus of the Company's exploration drilling campaign.
Pershing Gold is Uniquely Positioned to Achieve Fast-Track Reopening of the Relief Canyon Mine
Pershing Gold's Relief Canyon Mine property includes three open-pit mines and a state-of-the-art, fully permitted and constructed heap leach processing facility. These assets present Pershing Gold with a unique opportunity to achieve a fast-track path to production at the Relief Canyon Mine. Most of Pershing Gold's peer companies face at least several years of permitting, the challenge of raising significant capital in this difficult investment climate, and the risks and further delay associated with constructing a mine and processing facilities.
Because Pershing Gold already has a fully permitted and built heap leach processing facility, re-starting the mine and resuming gold production should proceed with minimal delays and capital investment. To ensure the readiness of these facilities for future production and to fine-tune their operation, Pershing Gold is planning an equipment test for before year-end 2012. The Company is also initiating the necessary design and permitting work to add a gold refinery to the existing facilities. Once recommissioned, the Relief Canyon heap leach facilities would be available to process ores from the Relief Canyon Mine and dumps as well as materials from other mines. The recommissioning and reopening of the Relief Canyon Mine is dependent on external funding, the completion of certain permitting activities and expansion of the resource.
In describing the near-term production opportunity at Relief Canyon, Pershing Gold Executive Chairman, CEO, and President, Stephen D. Alfers, explained that "We are in position to be Nevada's next new gold producer. We have a target date to be producing gold in 2014 from newly mined ore, gold-bearing materials on the dumps, and possibly toll ores from other properties. We believe we are ideally situated to emulate the production history at Hycroft where Allied Nevada Gold refurbished an existing heap leach facility and reactivated the Hycroft Mine in 2008 in record time and with limited additional capital investment."
A Year of Progress – Pershing Gold's Accomplishments Since Acquiring the Relief Canyon Mine Property
Immediately after acquiring the Relief Canyon Mine property, Pershing Gold developed a strategic plan to put the Relief Canyon Mine and heap leach processing facilities back into production. During the past year, the Company has accomplished the following key steps in realizing its goal to resume mining and gold production at Relief Canyon:
Consolidated the previously fractionated land ownership to gain control of the lands surrounding the Relief Canyon Mine, which has a NI 43-101 compliant inferred and indicated resource of approximately 248,000 ounces of gold;
Expanded landholdings adjacent to the mine in all directions that establishes the Company as a major landowner in the Pershing Gold and Silver Trend in the Humboldt Range;
Implemented an exploration drilling program with 89 holes completed as of September 9th (with drilling still in progress) at and near the existing mine to augment the historic database consisting of the 591 holes that previous owners drilled;
Identified new mineralization in all directions around the current boundary of the open-pit mines based on the 2011 and 2012 drilling programs;
Significantly improved its understanding of the Relief Canyon mineral system and used this new understanding to develop a new mineralization model for the Relief Canyon ore deposit to guide future exploration;
Initiated activities to recommission the heap leach processing facilities to enable near-term production of gold from Relief Canyon existing dumps and pits as well as ores from other mines;
Hired a team of mining, exploration, management, and permitting experts to put the mine back into production, discover new ore, and guide the Company to its next horizon;
Completed a sophisticated geophysical exploration program that identified numerous targets that may represent buried mineralized systems;
Drilled three holes to test geophysical anomalies outside of the area immediately surrounding the Relief Canyon Mine that discovered new hydrothermal systems and confirmed that geophysics can successfully identify attractive, blind drilling targets; and
- Developed a strategic relationship with Coeur d'Alene Mines Corporation (NYSE:CDE), (TSX:CDM) ("Coeur"), Pershing Gold's neighbor to the north, including Coeur's private placement purchase of 10,937,500 shares of Pershing Gold Corporation Common Stock.
Landmark Consolidation of Lands is Key to Reopening the Relief Canyon Mine
For the first time in several decades, the Relief Canyon Mine and the lands immediately surrounding the mine are controlled by a single owner. By consolidating ownership of these lands, Pershing Gold is in a unique position to develop and explore the Relief Canyon property without land boundary constraints.
Unlike the previous owner, who did not own or control the entire deposit or the lands adjacent to the pits and processing facilities, Pershing Gold has complete control of the entire land package needed to reopen and expand the mine, and has acquired substantial control of the Humboldt Range and the Pershing Gold and Silver Trend south of the Rochester Mine. "The significance of controlling all of the lands adjacent to the mine cannot be overstated," said Stephen Alfers. "We are not landlocked and do not face the land ownership constraints that handicapped previous owners' efforts to develop this asset."
As shown on Figure 1, Pershing Gold's wholly-owned subsidiary, Gold Acquisition Corp. ("GAC"), owns the lands on which the Relief Canyon Mine and processing facilities are located. Pershing Gold also leases mining claims and private lands from Newmont USA Limited, a subsidiary of Newmont Mining Corporation ("Newmont") (NYSE:NEM), that surround the mine. Pershing Gold acquired these lands in April 2012 when it purchased Victoria Resources' (US)/Victoria Gold Corp.'s (TSX-V:VIT) interests in Victoria's 2006 mineral lease and sublease with Newmont. The leased lands are subject to an Area of Interest ("AOI") with Newmont.
Figure 1. - Map of Pershing Gold's Land Holdings (http://media.globenewswire.com/cache/19459/file/15618.jpg)
As part of the Victoria transaction, Pershing Gold also acquired 62 claims previously owned by Victoria within the AOI and another 221 claims south of the AOI in an area known as the Pershing Pass Project. The claims acquired from Victoria in the Pershing Pass Area augment the Company's land holdings in this area which include a large block of claims that Pershing Gold acquired in February, 2012, making Pershing Gold the dominant land owner in the southern part of the Pershing Gold and Silver Trend.
The Company's initial land position when it took control of the Relief Canyon Mine in August 2011 consisted of only about 1,100 acres that covered the heap leach facility and most (but not all) of the Mine. Today, Pershing Gold's landholdings have grown considerably and now extend in all directions from the Relief Canyon Mine, covering approximately 24,700 acres. This land package includes roughly 14,600 acres of wholly-owned claims and about 10,100 acres of claims and private land subject to the AOI in the Newmont lease.
In discussing the growth of the Company's landholdings since taking control of the Relief Canyon Mine, Stephen Alfers noted, "We have made a number of strategic acquisitions to accomplish two objectives. First, we set out to gain complete control over the lands surrounding the mine to allow us to expand the mine in all directions and to explore these lands to discover new deposits that can be processed at the Relief Canyon heap leach facilities. Secondly, we sought to acquire the dominant land position in the southern part of the Pershing Gold and Silver Trend where there are a number of attractive and underexplored exploration targets south of the Mine in the Pershing Pass area."
The Pershing Gold and Silver Mineral District is Nevada's Hottest Under-Explored Trend
Pershing Gold believes that the Humboldt Range in the vicinity of Relief Canyon has significant potential for new gold and silver discoveries. As shown on Figure 2, there are several large operating gold and silver mines, known gold and silver deposits, and new gold discoveries in the Humboldt Range near Relief Canyon. These neighboring mines and discoveries include:
The Rochester Mine, which has produced over 100 million ounces of silver and 1 million ounces of gold;
The Florida Canyon Mine, which has produced over 2 million ounces of gold;
The Standard mine which produced about 500,000 ounces of gold; and
- The Spring Valley Project, which is a new discovery with at least 1.8 million indicated and inferred ounces of gold discovered to date.
Figure 2. - Map featuring gold and silver mines in the Pershing Gold and Silver Trend near Relief Canyon(http://media.globenewswire.com/cache/19459/file/15619.jpg)
Secondly, Pershing County's Humboldt Range is under-explored compared to other northern Nevada gold districts. For decades, most of the exploration conducted in northern Nevada has focused mainly on gold districts like the Carlin Trend and the Getchell Trend which are located east of Pershing County. Consequently, there is a significant window of opportunity to acquire promising gold targets in Pershing County and to discover new gold deposits.
Pershing Gold has Discovered New Mineralization in its First Year Exploring Relief Canyon
Immediately after acquiring the Relief Canyon Mine property, Pershing Gold launched a drilling program that has successfully identified new areas of mineralization beyond the boundaries of the existing open-pit mines. This drilling program has discovered gold in numerous drill holes that the Company expects to upgrade and expand the resource attributable to the Relief Canyon Mine property. Pershing Gold is planning to release a NI 43-101 Technical Report in the fourth quarter 2012 to document the expanded resource.
Since August 2011, Pershing Gold has drilled 89 holes in the vicinity of the Relief Canyon Mine as of September 9th with more drilling currently underway south of the mine. This drilling effort has included both reverse-circulation rotary and core drilling. Approximately 52,100 feet (15,880 meters) have been drilled to date in the Relief Canyon Mine area. In addition, the Company has drilled three exploration holes totaling 1,982 feet (604 meters) in the Pershing Packard and South Relief target areas located in frontier areas outside of the mine vicinity to test geophysical anomalies
Most of the holes drilled by Pershing Gold in the Relief Canyon Mine vicinity are located outside of the existing Mine boundary and the existing resource identified in Mine Development Associates' ("MDA's") 2010 Technical Report. The Company expects these holes to expand the 2010 resource, based on the 591 holes (approximately 201,760 feet or 61,496 meters) drilled by previous owners in all directions as shown in Figure 3. This area of likely resource expansion represents drill hole intercepts in the Main Breccia Zone style of mineralization discussed below.
In commenting on the Company's successful first year of exploration, Stephen Alfers stated, "Pershing Gold is quite pleased with the results of our first year of drilling which confirms the presence of additional mineralization at Relief Canyon. We are confident that the updated NI 43-101 Technical Report will show a significant expansion of the resource at the Relief Canyon Mine."
Figure 3. - Map showing area of projected expanded resource based on recent drilling at the Relief Canyon Mine (http://media.globenewswire.com/cache/19459/file/15620.jpg)
Ongoing Work Includes More Drilling and Development of a New 43-101 Technical Report
Pershing Gold is planning significant work for the remainder of 2012. The Company recently started a reverse-circulation drilling program immediately south of the existing pits to explore private lands on which only a few, shallow holes were drilled by previous operators. The Company expects to drill approximately 65 holes in this area by late September or early October 2012. This drilling effort will test deeper mineral targets than have previously been tested in this area. Additional work in this area also includes evaluation of waste rock dumps. Several of these dumps may contain sufficient gold to warrant re-mining and processing in the heap leach facility in the relatively near future.
By the end of the third quarter 2012, Pershing Gold expects to have drilled more than 100 drill holes at the Relief Canyon Mine. This new database is expected to significantly increase the resource. The Company has engaged MDA to prepare a NI 43-101 compliant updated resource estimate in the fourth quarter 2012, using information from this new database. Additionally, the Company plans to use the new exploration model described below, which has identified the controls on gold mineralization, to guide future exploration that will test new targets with the objective of further expanding the resource base.
New Exploration Model Greatly Enhances Discovery Potential at Relief Canyon
Based on the findings from the 2011-2012 drilling program, Pershing Gold's geologists have developed a new exploration model that recognizes three different styles of mineralization: the Main Breccia Zone, which previous operators explored and mined, and two new mineralized zones, the Feeder Zones and the Lower Zone. "By identifying two new styles of mineralization, the Feeder Zones and Lower Zone, we have made an important and exciting breakthrough in understanding the geology of the Relief Canyon deposit which we feel greatly expands our discovery opportunities," Stephen Alfers said with enthusiasm. "Our new exploration model greatly enhances our ability to identify new, high-priority drilling targets that we believe are likely to intercept new mineralization that could significantly expand the mineral resource at the Relief Canyon Mine."
The three mineralization types are discussed in more detail below. Figure 4 is a cross section illustrating the three styles of mineralization at Relief Canyon.
Figure 4. - Cross section illustrating the three types of mineralization at Relief Canyon. (http://media.globenewswire.com/cache/19459/file/15621.jpg)
The Main Breccia Zone Mineralization
The Main Breccia Zone is the mineralization type that previous operators principally explored and mined from the three existing pits, the North, South, and Lightbulb Pits. This gold-bearing zone is associated with a sub-horizontal structural contact between the Grass Valley and Cane Springs formations. The Main Breccia Zone, as defined by the current drilling, extends approximately 2500 feet north-south, and 3000 feet east-west and is open to the east, west and south and outcrops to the north. The Main Breccia Zone mineralization thickness varies from about 10 feet to as much as 150 feet thick.
The 2010 MDA Technical Report shows a contained resource within the Main Breccia Zone of approximately 248,000 inferred and indicated ounces of gold. Expansion of this resource is the primary goal of Pershing Gold's current drill programs. The Company's new exploration model clearly outlines areas where Main Breccia Zone mineralization is likely to be found. Using this model, Pershing Gold's geologists have developed a focused exploration drilling campaign to explore this zone.
Feeder Zone Mineralization
The Feeder Zone mineralization consists of steeply-dipping, north-trending gold-bearing structures that are typically faults and fractures. The discovery of this new style of mineralization at Relief Canyon is a significant milestone in the exploration history of this deposit because previous operators did not recognize or exploit this mineralization. Consequently, the gold mineralization contained in the Feeder Zones is not currently included in the resource model. The Feeder Zones are expected to contribute significantly to the Relief Canyon gold resource because the grade in these zones is typically two to five times higher than the grade in the Main Breccia Zone.
The Feeder Zones are believed to be the source of the gold for the Main Breccia Zone and the Lower Zone Mineralization. Two Feeder Zones are present in the North Pit. Work is underway to identify Feeder Zones in the South and Lightbulb Pits to define these zones.
Lower Zone Mineralization
The Lower Zone mineralization is another new type of mineralization that Pershing Gold geologists have recently discovered at Relief Canyon. This type of mineralization is developed below the Main Breccia Zone as a favorable stratigraphic horizon and possible bedding plane fault zone in the Cane Springs Formation. Like the Feeder Zone mineralization, the Lower Zone mineralization has not been included in the current resource model. The gold intercepts drilled to date in the Lower Zone are typically higher grade than the Main Breccia Zone. The Lower Zone is tabular, dips to the south, and is open to the south. To the north, the zone is truncated by a northwest-trending fault zone.
Table 1 presents some of the highlights from the 2011-2012 drilling program and shows the mineralization style for each of the listed drill holes. This table includes results for RC12-021 through RC12-029. The drilling results for these holes were not included in Pershing Gold's July 12, 2012 press releases. Figure 5 shows the locations for the 2011 and 2012 drilling program through July 2012 for which results are available. Pershing Gold will release the results from the ongoing drilling program south of the mine when they become available.
Figure 5. - August 2011 – July 2012 drill hole map (http://media.globenewswire.com/cache/19459/file/15622.jpg)
|Table 1. Summary of Significant Drill Intercepts from 2011-2012 Relief Canyon Mine|
|Exploration Program through July 2012|
|Drill Hole||From||To||Width||Au gpt||Au opt||Mineralization Style|
|SBG11-RC04||280||380||100||1.440||0.042||Main Breccia Zone|
|SBG11-RC05||270||300||30||0.610||0.018||Main Breccia Zone|
|SBG11-D03||244||274||30||0.880||0.026||Main Breccia Zone|
|SBG12-D02||253||291||38||2.560||0.075||Main Breccia Zone|
|SBG12-D03||505||560||55||4.287||0.125||Lower Zone/Feeder Zone|
|SBG12-D04||0||309||309||0.486||0.014||Main Breccia/Feeder Zone|
|SBG12-D05||13||125.9||112.9||0.541||0.016||Main Breccia/Feeder Zone|
|RC12-013||297||457||160||0.271||0.008||Main Breccia Zone|
|RC12-014||113||164.3||51.3||1.286||0.037||Main Breccia Zone|
|RC12-015||253||430||177||0.398||0.012||Main Breccia Zone|
|RC12-016||209||236.5||27.5||1.125||0.033||Main Breccia Zone|
|RC12-017||220||435||215||0.504||0.015||Main Breccia Zone|
|including||226.3||294||67.7||0.896||0.026||Main Breccia Zone|
|RC12-018||374||494||120||0.336||0.01||Main Breccia Zone|
|RC12-019||230.5||427||196.5||0.378||0.011||Main Breccia Zone|
|including||239||290.5||51.5||0.796||0.023||Main Breccia Zone|
|RC12-021*||274||398.2||124.2||0.384||0.011||Main Breccia Zone|
|RC12-023*||396||428.5||32.5||0.632||0.018||Main Breccia Zone|
|RC12-024*||706.1||744||37.9||0.680||0.02||Main Breccia Zone|
|RC12-025*||373.5||414||40.5||0.291||0.009||Main Breccia Zone|
|RC12-027*||244.5||368||123.5||0.503||0.015||Main Breccia Zone|
|RC12-028*||222||368||146||0.539||0.016||Main Breccia Zone|
|* Newly released results|
Note: The reported width is not the true width of the intercept. Results from all intervals for which we have received and verified results will be posted on our website at www.pershinggold.com
Geophysical Programs have Successfully Identified New Mineralized Systems Outside of the Relief Canyon Mine Area
Pershing Gold recently completed a sophisticated geophysical exploration program that consisted of gravity, magnetics, Controlled-Source Audio-Frequency Magnetotelluric (CSAMT), and Induced Polarization (IP)/Resistivity surveys. These surveys were designed to identify targets buried underneath the broad pediment areas in the vicinity of the Pershing Packard Project north of the Relief Canyon Mine, the Pershing Pass area south of the Relief Canyon Mine, and the lands immediately west of the mine.
In explaining geophysics as an effective exploration tool, Stephen Alfers said, "Geophysical surveys are an essential component of our exploration program because we believe there is significant potential for buried targets in areas of our landholdings that are covered by gravels and other alluvial deposits. We can use geophysics to locate buried structures that could represent conduits for mineralizing fluids."
The Company believes that the survey results indicate the presence of prominent crustal-penetrating structural zones that could include folds, faults, and fractures that may localize mineralization. The surveys have identified several new buried exploration targets indicating strong potential for mineralization at structural intersections beneath the pediment west of the Relief Canyon Mine. As discussed below, Pershing Gold has already used the surveys to identify drilling targets at the Pershing Packard and South Relief projects, both of which encountered buried, mineralized systems. Figure 6 illustrates the structural zones and geophysical anomalies discovered by the geophysical surveys.
Figure 6. - Map showing geophysical anomalies at and near the Relief Canyon Mine (http://media.globenewswire.com/cache/19459/file/15623.jpg)
Pershing Packard Project
Pershing Gold has drilled two holes, PPD12-01 and-02, to test a geophysical target in Section 5 at the Pershing Packard Project, which is located near Pershing Gold's northern property boundary and the border shared with neighboring Coeur on private lands that Pershing Gold leases from Newmont. Both holes encountered difficult drilling ground conditions and had to be abandoned before fully testing the geophysical anomaly. PPD12-01 was lost before encountering bedrock. The second hole, PPD12-02, was completed to a depth of 1,337 feet (408 meters) and encountered fault-bounded sections of the Grass Valley, Cane Springs, and Prida Formations that displayed various degrees of alteration and mineralization. Gold and silver values were spotty, with some fault zones anomalous in both precious metals. This hole contains locally elevated levels of arsenic, an important pathfinder element for gold and silver.
South Relief Project
Pershing Gold drilled one hole, SR12-001R, at the South Relief Project in Section 19 to test another geophysical target. The upper part of this 645-foot (197-meter) hole included several anomalous gold values up to 0.155 grams per ton (0.005 ounces per ton Au) over five-foot intervals. Below a major fault zone the hole encountered significant alteration and a highly anomalous suite of trace elements including mercury, antimony and arsenic that are typically associated with Nevada gold deposits. Gold is weakly anomalous in this zone. Additional drill holes are planned later in 2012 at the South Relief Project, if funding is available.
Strategic Partnership with Coeur – Our Neighbor to the North
In June, Pershing Gold completed a private placement with Coeur d'Alene Mines Corporation in which Coeur purchased 10,937,500 shares of Pershing Gold Corporation Common Stock at $0.32 per share. Coeur's investment in Pershing Gold reflects the synergies between the two companies – especially in the vicinity of the boundary they share between Coeur's Nevada Packard Mine and Pershing Gold's Pershing Packard Project which is located about one mile south of Nevada Packard. Figure 7 illustrates the proximity of the Nevada Packard Mine to Relief Canyon.
Figure 7. - Photograph showing drilling in North Pit at Relief Canyon with Coeur's Packard Mine in the background to the north (http://media.globenewswire.com/cache/19459/file/15624.jpg)
Pershing Gold geologists believe that the mineral system that the Company discovered at Pershing Packard may be related to the system that Coeur mined at the Nevada Packard Mine. Future work will test this hypothesis.
Legal Notice and Safe Harbor Statement
This press release contains "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, including, without limitation, those with respect to the objectives, plans and strategies of the Company set forth herein including the planned reopening and recommissioning of the Relief Canyon mine and processing facilities, commencement of production targeted for 2014, anticipated drilling and other exploration on Pershing Gold's Relief Canyon properties, results of drilling, interpretations of exploration results and other geologic information at Relief Canyon, anticipated expansion of the resource at the Relief Canyon properties, and those preceded by or that include the words "believes," "expects," "given," "targets," "intends," "anticipates," "plans," "projects," "forecasts" or similar expressions, are "forward-looking statements." Although the Company's management believes that such forward-looking statements are reasonable, it cannot guarantee that such expectations are, or will be, correct. These forward-looking statements involve a number of risks and uncertainties, which could cause the Company's future results to differ materially from those anticipated. Potential risks and uncertainties include, among others, inability to obtain external financing to fund the recommissioning of the processing facilities, and the reopening and commencement of production at the Relief Canyon Mine, planned exploration or maintain property rights; interpretations or reinterpretations of geologic information, unfavorable exploration results, inability to obtain permits required for planned production, exploration and other activities, general economic conditions and conditions affecting the industries in which the Company operates; the uncertainty of regulatory requirements and approvals; fluctuating mineral and commodity prices; risks of junior exploration and pre-production activities; and maintenance of important business relationships. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in the Company's filings with the SEC including the Annual Report on Form 10-K for the year ended December 31, 2011 and each subsequently filed Quarterly Report on Form 10-Q and Current Report on Form 8-K. The Company assumes no obligation to update any of the information contained or referenced in this press release.
Cautionary Note to United States Investors Regarding Estimates of Measured, Indicated and Inferred Resources: We use certain terms in this press release, such as "measured", "indicated" and "inferred resources", that are defined in Canadian National Instrument 43-101; however these terms are not recognized under the U.S. SEC Industry Guide 7. U.S. investors are cautioned not to assume that any or all of measured, indicated or inferred resources are economically or legally mineable or that these resources will ever be converted into reserves. "Inferred mineral resources" have a high degree of uncertainty as to their existence and it cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. U.S. investors are urged to consider closely the disclosure in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other SEC filings. You can review and obtain copies of these filings from the SEC's website at http://www.sec.gov/edgar.shtml.
Scientific and Technical Data
All scientific and technical information for the Relief Canyon project has been reviewed and approved by Robert B. Hawkins, P.Geo, who is a Qualified Person under the definitions established by Canadian National Instrument 43-101. Drill core at Relief Canyon is boxed and sealed at the drill rig and moved to the Relief Canyon logging and sample preparation facilities by trained personnel. The core is logged and split down the center using a typical table-fed circular rock saw. One half of the core is sent for assay to ALS Chemex, Reno, Nevada, while the other half is returned to the core box and stored at Relief Canyon in a secure, fenced-off, area. Pershing Gold Corporation quality assurance/quality control (QA/QC) procedures include the regular use of blanks, standards, and duplicate samples.
CONTACT: Stephen D. Alfers Executive Chairman, President and CEO Phone Number: 720.974.7248 Email: email@example.com www.PershingGold.com