Ketchem
Target: Millrock is targeting high grade gold vein stockworks and bulk minable gold deposits associated with magmatic intrusive rocks at the Ketchem property. Placer gold has been mined in the Circle Mining District since 1893, with total production exceeding one million ounces. Ketchum Creek, Portage Creek and Bottom Dollar Creek, which drain the property area, are current placer gold producers and are considered among the most prolific producers in the district. High grade gold-bearing quartz veins occur at the 88, Silver Chalice, and several other prospects on the property. Location and Setting: The Ketchem project is located in the eastern portion of the Circle Mining District, in the Circle B-2 quadrangle. The project is road accessible and is located approximately 241 road kilometers (150 miles) northeast of Fairbanks. Excellent quality airstrips exist at the nearby communities of Circle Hot Springs (approximately 10 kilometers or 6 miles from the property) and at Central (approximately 29 kilometers or 18 miles from the property). Food, lodging, fuel and telephone are available year-round in Central. The surrounding countryside is characterized by moderate, spruce-covered hills. Agreement: The Ketchem project consists of a total of over 5,000 acres of mineral rights that are subject ton an agreement with Spectrum Resources Inc. (SRI), a company owned by geologist David Adams of Fairbanks. The agreement includes a minimum work commitment, option payments, and Millrock share issuances as tabulated below: | | Work Commitment | Option Payment | Stock | | By First Anniversary | $ 200,000 | $ 20,000 | 15,000 shares | | By Second Anniversary | $ 300,000 | $ 30,000 | 25,000 shares | | By Third Anniversary | $ 500,000 | $ 40,000 | 30,000 shares | | By Fourth Anniversary | $ 900,000 | $ 50,000 | 40,000 shares | | By Fifth Anniversary | $1,100,000 | $ 60,000 | 50,000 shares | | Total | $3,000,000 | $200,000 | 160,000 shares |
By virtue of the agreement, Millrock has the option to purchase the mineral rights from Spectrum for the price of US$1.5 million. Spectrum would be entitled to a royalty of 2.5%. Millrock may reduce the amount of the royalty to 0.5% by paying Spectrum US$3.0 million. Geology and Mineralization: The Circle Mining District lies along the northern edge of the Tintina Gold Belt, an arcuate belt which extends across central Alaska. Gold deposits within the belt are largely of the plutonic-related type. They are associated with late Cretaceous granitic plutons. Magmatic hydrothermal fluids carried and deposited gold and other metals in a wide variety of settings. In the eastern portion of the Circle Mining District, gold mineralization is associated with the Late Cretaceous Two Bit pluton, the Tertiary Hot Springs pluton, and adjacent country rocks. Intrusive-hosted and metasediment-hosted gold mineralization occurs on the Portage property. In both settings, the gold mineralization consists of quartz veins and stockworks containing variable amounts of sulfides. Granite-hosted gold mineralization occurs at the 88 prospect, and quartzite-hosted gold mineralization occurs at the Silver Chalice prospect and several other prospects on the property. At the 88 Prospect, three structurally controlled zones of gold bearing quartz veins and stockworks have been identified by prior workers, which include Placer Dome and AMAX. Widths of the zones range between three and 25 meters (82 feet). One of the zones is reported to grade 8.92 grams per tonne gold over a width of 4.6 meters (15 feet) in altered granite. A grab sample from the zone is reported to contain over 36 grams per tonne gold. Three holes have been drilled by previous workers, but do not seem to have been drilled in an orientation that would result in intersection of the vein system. Three reverse circulation drill holes (one vertical and two angled) were drilled near the west edge of the 88 prospect discovery zone. The drilling intersected multiple gold-anomalous zones containing gold values ranging up to 745 ppb gold. The drill holes do not appear to intersect much of the gold mineralization as projected down-dip from the surface. Gold mineralization at the Silver Chalice prospect occurs in quartz - sulfide veinlets in altered sedimentary rocks. Grab samples have returned values up to 32.0 grams per tonne gold. Exploration Program: The following exploration program is recommended: - Grid-based auger soil sampling program.
- Mapping and prospecting.
- Trenching and channel sampling on the 88 prospect and the Silver Chalice prospect.
- Diamond core drilling and / or reverse circulation drilling program on the 88 prospect.
- Contingent upon positive results, a bulk sampling program on the 88 prospect.
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