Homestake Resource Corporation

Homestake Resource Corporation

August 09, 2012 14:13 ET

Homestake Ridge Drilling Underway; Claims Added to Kinskuch

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 9, 2012) - Homestake Resource Corporation (TSX VENTURE:HSR)(FRANKFURT:B6IH) has begun drilling at its wholly owned Homestake Ridge project in northwestern British Columbia. The core holes will offset high-grade gold mineralization discovered in 2011 at the South Reef deposit, which is located approximately 800 metres to the southwest of the Homestake Silver deposit along a parallel mineral trend. The initial holes will offset three holes from the 2011 program that tested a 75 metre strike-length of the mineralized trend to depths of 260 metres and intersected +30g/t gold in each hole, including a 3.1m interval averaging 30.8g/t Au and 3.3g/t silver within a 8.7 metre interval averaging 11.3g/t gold and 1.6g/t silver from drill hole HR11-232 (see NR-14-11).

South Reef is the third high-grade gold/silver deposit discovered by Homestake Resource Corporation in this evolving district. Mineralization is open at depth and along the full 3.4km strike length of the target horizon, which is nearly twice the cumulative strike-length of the previously delineated Main Homestake and Homestake Silver deposits.

Kinskuch Project

The Company reports that it has also added an additional 2964 ha of claims in two claim groups to the Kinskuch property, bringing the total area of the claim package to 62,364 ha (623 sq km). Claims were added on the northern margin of the property and cover a portion of the headwaters of the White River. A second group of claims were staked along the southeastern projection of the Homestake and Dolly Varden mineral trends in the western part of the property, overlying the historic Silver King mineral showing. BC government records describe the Silver King showing as "a series of quartz stringers and veins up to 1m in widths which are within and parallel a shear zone that is up to 15m wide". The veins contain variable amounts of galena and sphalerite with grades of up to $8 to $10 per ton, as reported in 1921, which were calculated by BC Minfile as equivalent to 576g/t silver. These results have not been verified by Homestake Resources and cannot be relied upon.

The showing will be evaluated and prospected during the 2012 exploration season as part of a limited surface program targeting portions of the Kinskuch claims.

Corporate Update

The company also announces that it has closed the second tranche of its previously announced non-brokered private placement of 10 million Units by issuing 837,500 non flow-through Units for gross proceeds of $167,500. Each non flow-through Unit is priced at $0.20 per Unit. Each Unit is comprised of one common share and one share purchase warrant, each whole warrant entitling the purchase of one common share at a price of $0.30 per share for 36 months. Net proceeds from the non flow-through financing will be added to general working capital to be used for corporate purposes.

All securities issued pursuant to this tranche of the private placement, including common shares, share purchase warrants and finder's warrants issued as finder's fees, carry a legend restricting trading of the securities until December 10, 2012. The private placement and finder's fees are subject to regulatory approval.

About Homestake

Homestake owns a 100 percent interest in the Homestake Ridge project, which is located in a prolific mineral belt in northwestern British Columbia. The project is being advanced as a potential high-grade underground mining operation with a current NI43-101 compliant Indicated Resource, at a 3.0g/t AuEq. cut-off, of 191,000 oz gold and 1,350,000 oz silver (215,500 oz AuEq) plus an Inferred Resource of 530,000 oz gold and 13,470,000 oz silver (775,900 oz AuEq)(1). Two deposits have been delineated to date, with a third, South Reef, discovered late in 2011. Multiple exploration targets remain to be tested on the large 2585 hectare property. Homestake also holds an option to acquire the 623-square-kilometre Kinskuch project located adjacent to, and to the southeast of, Homestake's Homestake Ridge project. Homestake holds a 9.76 percent interest in Bravada Gold Corporation (TSX VENTURE:BVA), which is exploring 21 projects in Nevada.


Joseph A. Kizis Jr., President

  1. The current estimate was prepared by Roscoe Postle Associates Inc. (RPA). Mineral Resources on the Main Homestake deposit were estimated previously in 2010 using a block model constrained by 3D wireframes of the mineralized zones. Mineral Resources on the Homestake Silver deposit were estimated in 2011 using a block model constrained by pierce points projected to 2D surfaces. The Main Homestake block model comprised an array of blocks measuring 5 m x 5 m x 5 m, with grades for Au, Ag, and Cu interpolated using ID3 weighting. The Homestake Silver block model comprised an array of blocks measuring 10 m x 10 m. At a 3.0g/t AuEq cut-off, the models identified an indicated resource of 888,000 tonnes averaging 6.7g/t Au, 47.2g/t Ag and 0.15% Cu and a cumulative inferred resource of 4,060,000 tonnes averaging 4.3g/t Au, 158g/t Ag.

This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. These statements are based on a number of assumptions, including, but not limited to, assumptions regarding general economic conditions, interest rates, commodity markets, regulatory and governmental approvals for the company's projects, and the availability of financing for the company's development projects on reasonable terms. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation and exploration successes, the timing and receipt of government and regulatory approvals, and continued availability of capital and financing and general economic, market or business conditions. Bravo Gold Corp does not assume any obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by applicable law.

Neither 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.

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