Midway Gold Announces Initial Underground Resource for Midway Project,
Nevada
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Midway Gold Corp. (TSX.V and NYSE Amex: MDW) (the
"Company") announces the results of an initial underground resource
evaluation of the Midway project located in Nye County, Nevada. The
accompanying National Instrument (NI) 43-101 technical report to be filed on
SEDAR within 45 days contains a technical and scientific review of information
regarding the project and makes certain recommendations for future work
programs. A summary of the conclusions in the technical report is provided
below. The NI 43-101 report was independently prepared by Gustavson Associates,
LLC ("Gustavson") of Lakewood, Colorado.
A resource estimate prepared by Mine Development Associates in 2005 using an
open pit mining scenario calculated an inferred low grade resource of 5.5
million short tons containing 215,500 ounces of gold at an average grade of
0.039 oz/ton gold. While the Company considers the 2005 estimate valid, it
believes preferred and optimal development at the Midway project may be through
underground mining focused on the structurally controlled gold zones.
Underground mining also recognizes certain site sensitivities involving
archaeology and groundwater considerations that partially formed the basis for
a recent cooperative agreement with the Town of Tonopah (see press release
dated February 17, 2011). Core drilling designed to further define additional
veins is in progress and is anticipated to continue throughout the year. The
Company has also undertaken a program to implement the recommendations of
Gustavson as noted below. Management will assess the results of these efforts
and will commission further independent analysis as and when required.
Therefore, the current NI 43-101 compliant resource estimate was commissioned
to evaluate a limited number of vein-like structures primarily in the Discovery
Zone. Gustavson modeled mineralization using an Indicator Kriging method to
analyze zones of potential high grade mineralization that may or may not
correspond to modeled veins but which may represent veins that have not yet
been modeled. This indicator model was calibrated by comparison with the
modeled vein cross sections, and appears to have identified higher grade areas
with continuous gold mineralization that could possibly be mined by underground
methods.
Midway
Project Initial Inferred Underground Resource
Cutoff Grade
(oz/ton)
|
|
Short
Tons
(thousands)
|
|
Grade
(oz/ton)
|
|
Ounces
|
|
0.1000
|
|
114.0
|
|
0.3017
|
|
34,394
|
|
0.0750
|
|
127.0
|
|
0.2813
|
|
35,725
|
|
0.0500
|
|
130.0
|
|
0.2758
|
|
35,854
|
|
0.0200
|
|
131.0
|
|
0.2742
|
|
35,920
|
|
Recommendations
Gustavson recommends the following work plan, which the Company has commenced:
• Twin a select number of reverse circulation drill holes in the various
mineralized zones by diamond drill core to compare methodologies and resulting
assay results.
• Compile, analyze and document QA/QC data generated by Midway and Chemex
for all assays completed since 2004.
• As part of an ongoing QA/QC program with drill samples, submit blank
samples at the rate of 2%.
• Compile, analyze and document the metallic screen assay results as
compared with the original fire assays and/or with duplicate analyses run on
the same samples.
• Conduct future definition drilling with diamond drill core and restrict
reverse circulation drilling to exploration activities.
This release has been reviewed and approved by Mr. Donald E. Hulse (P.E.),
Principal Mining Engineer of Gustavson, and a "qualified person" as
that term is defined in NI 43-101. This release has also been reviewed and
approved for Midway by Mr. William S. Neal (M.Sc. and CPG), Vice President of
Geological Services of Midway, and a "qualified person" as that term
is defined in NI 43-101.
ON BEHALF OF THE BOARD
"Kenneth A. Brunk"
Kenneth A. Brunk, Director, President and COO
About Midway Gold Corp.
Midway Gold Corp. is a precious metals company with a vision to explore,
design, build and operate mines in a manner accountable to all stakeholders
while producing an acceptable return to its shareholders. For more information
about Midway, please visit our website at www.midwaygold.com or contact R.J.
Smith, Manager of Corporate Administration, at (877) 475-3642 (toll-free).
Neither the TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This press release contains forward-looking statements about the Company and
its business. Forward looking statements are statements that are not historical
facts and include, but are not limited to, statements about the Company's
intended work plans for the Midway project and resource estimates. The
forward-looking statements in this press release are subject to various risks,
uncertainties and other factors that could cause the Company's actual results
or achievements to differ materially from those expressed in or implied by
forward looking statements. These risks, uncertainties and other factors
include, without limitation, risks related to the timing and completion of the
Company's intended work plans for the Midway project, risks related to
fluctuations in gold prices; uncertainties related to raising sufficient
financing to fund the planned work in a timely manner and on acceptable terms;
changes in planned work resulting from weather, logistical, technical or other
factors; the possibility that results of work will not fulfill expectations and
realize the perceived potential of the Company's properties; uncertainties
involved in the interpretation of drilling results and other tests and the
estimation of gold resources; the possibility that required permits may not be
obtained on a timely manner or at all; the possibility that capital and
operating costs may be higher than currently estimated and may preclude
commercial development or render operations uneconomic; the possibility that
the estimated recovery rates may not be achieved; risk of accidents, equipment
breakdowns and labor disputes or other unanticipated difficulties or
interruptions; the possibility of cost overruns or unanticipated expenses in
the work program; and other factors identified in the Company's SEC filings and
its filings with Canadian securities regulatory authorities. Forward-looking
statements are based on the beliefs, opinions and expectations of the Company's
management at the time they are made, and other than as required by applicable
securities laws, the Company does not assume any obligation to update its
forward-looking statements if those beliefs, opinions or expectations, or other
circumstances, should change.
Cautionary note to U.S. investors concerning estimates of reserves and
resources: This press release uses the terms "reserve" and
"mineral resource", which are terms defined under Canadian National
Instrument 43-101 and the Canadian Institute of Mining and Metallurgy
Classification system. Such definitions differ from the definitions in U.S.
Securities and Exchange Commission ("SEC") Industry Guide 7. Under
SEC Industry Guide 7 standards, a "final" or "bankable"
feasibility study is required to report reserves, the three-year historical
average price is used in any reserve or cash flow analysis to designate
reserves and the primary environmental analysis or report must be filed with
the appropriate governmental authority. Mineral resources are not mineral
reserves and do not have demonstrated economic viability. The SEC normally only
permits issuers to report mineralization that does not constitute SEC Industry
Guide 7 compliant "reserves" as in-place tonnage and grade without
reference to unit measures. The references to a "geologic reserve"
and "ounces" of gold in this press release are not normally permitted
under the rules of the SEC. It cannot be assumed that all or any part of
mineral deposits in any of the above categories will ever be upgraded to Guide
7 compliant reserves. Accordingly, disclosure in this press release and in the
technical reports contained in this press release may not be comparable to
information from U.S. companies subject to the reporting and disclosure
requirements of the SEC.