Klondike Gold Corp.

Klondike Gold Corp.

July 31, 2008 18:52 ET

Klondike Gold Corp.-2008 Exploration Update: Precious Metal Projects

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 31, 2008) - Klondike Gold Corp. (TSX VENTURE:KG) is pleased to announce its updated 2008 exploration program on several precious metal projects in the Kootenays of southeastern British Columbia. These include the Clubine, a past-producing polymetallic silver vein camp just north of Salmo, the gold-copper Red Point property just east of the Rossland gold camp, and Ron Gold, a gold prospect west of Nelson. Dependent on financing, programs will involve geological mapping, some soil geochemistry, trenching and at Red Point, drilling. Klondike Gold is well positioned to advance these properties as they control considerable land packages, have a well-qualified exploration staff, and through another company of the Hughes Exploration Group, Klondike Silver Corp., have a fully operational mill located near New Denver.

The Clubine property, located just north of Salmo, is a past producing precious metal-lead-zinc property wholly owned by Klondike Gold Corp. The property produced 3,800 oz gold and 7,200 oz of silver, as well as lead and zinc, mainly between 1936 and 1939. Previous work indicates that gold increases with depth, with a reported 34.6 g/tonne Au over 21.6 meters (1 oz/ton over 70.9 feet) in the underground Level 2 (Yellowjack private report, 1990 - these intercepts are non-Policy 43-101 compliant, true thickness and grades will be determined with future drilling). Additional exploration by the former owners (Yellowjack Resources Ltd.) included drilling beneath the No. 5 level, with the intersection of gold-quartz veins and silicified zones, and the discovery in 1990 of the Maggie zone, approximately 1 km to the northwest.

Proposed exploration by Klondike Gold includes compilation of all past data in digital format, retrenching and new trenching around known mineralization at the Maggie zone, infill soil sampling, reevaluation of past geochemical data, and a ground geophysical survey. Based on results from this initial work, a second phase will include diamond drilling to test for gold zones noted in underground workings and to determine strike and depth of surface mineralized structures. With positive results, direct shipping of silver-lead-zinc material to the Klondike Silver mine site at Sandon will be considered.

Considerable exploration by Klondike Gold Corp. on the Red Point property, including airborne geophysics and diamond drilling, has identified several gold and gold-copper targets. 2007 exploration focused on a large, bulk tonnage gold-copper target on the northern part of the property, with the most northern of four holes intersecting anomalous gold and copper through most of its 220-meter length. Several higher grade intervals included approximately 10 m grading 1400 ppb (1.4 g/tonne) Au, 2 m grading 3900 ppb (3.9 g/tonne) Au and 0.4 m grading 6400 ppb (6.4 g/tonne) Au. Further drilling here should be directed to the largely underexplored area immediately to the northeast. High grade vein targets, similar to the massive sulphide Au-Cu veins that characterize the Rossland camp, have been discovered and require further evaluation, including trenching and drilling. A high grade gold-quartz vein, the Cathedral vein, is exposed in a small open cut nearly 1.5 km south of the North zone. It has a true width of several meters, and has returned grab sample values that range up to 46 g/tonne gold. Cathedral lies along a well-defined east-northeast trending structural trend, marked by a pronounced airborne anomaly and a coincident gold soil anomaly, which requires further exploration. The similarity in geology, structural trends, and locally styles of mineralization between the Red Point camp and the Rossland camp, which produced approximately 3 million ounces of gold, enhances the potential of the Red Point camp.

The Ron Gold property is located west of Nelson, and along the structural trend of Sultan Mineral's Keno property immediately to the south. They are within a wide north-trending shear, and are underlain by mainly Nelson age granitic rocks, similar to those that host the Rossland Gold camp, and lesser Rossland volcanic rocks. Considerable past work includes soil sampling by previous owners, an I.P. survey, limited mapping and some sampling of known mineralized showings The claims are surrounded by past producers and prospects, yet the claims are largely under-explored, largely due to past fragmented ownership and general lack of outcrop. A soil geochemical survey (by U.S. Borax) covered only a part of the ground but was successful in returning copper values to over 4000 ppm and gold values to 800 ppb (0.8 g/tonne). Work by Klondike Gold is limited to a few days sampling along road cuts. There has been no additional soil surveys, geophysics, prospecting or geological mapping. A limited 2008 field program is proposed, including reconnaissance mapping, extending the soil grid, and prospecting and sampling.

Klondike Gold also announces that it has terminated option agreements for the JCD & IOCG Cranbrook South properties, due to less than favorable results.
The Qualified Person for the purpose of National Instrument 43-101 is Trygve Hoy who has read and agreed with the contents of this news release.

About Klondike Gold Corp.

Klondike Gold Corp.'s portfolio covers mineral exploration for gold, silver, lead, zinc, and diamonds in some of the best known mining areas of Canada. Klondike Gold Corp.'s cost of acquisition for these properties has been relatively inexpensive by getting positioned in the camps when metal prices and exploration activity were low. It is now well positioned to take maximum advantage of improved metal prices. Details relating to exploration activities on specific properties will be announced as the work programs are implemented.

Or visit Klondike Gold's web-site: www.klondikegoldcorp.com to see Smartstox interviews with the Company's President.

The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Hughes Exploration Group
    Kevin Hull
    Investor Relations
    (604) 685-2222
    (604) 685-3764 (FAX)
    Website: www.klondikegoldcorp.com