Newmarket Gold Inc.
TSX : NMI

Newmarket Gold Inc.

September 21, 2015 07:30 ET

Newmarket Gold Achieves Continued Exploration Success at Cosmo and Stawell Gold Mines

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Sept. 21, 2015) - Newmarket Gold ("Newmarket" or the "Company")(TSX:NMI) is pleased to announce positive results from an additional 7,805 metres (m) of drilling, including 39 drill holes at the Cosmo Gold Mine, Northern Territory, Australia, and 2,070 m of drilling in 4 drill holes at Stawell Gold Mines, Victoria, Australia. These results are part of Newmarket's 2015 growth exploration program and include continued intercepts of significant gold mineralization from the Sliver Lode and Cosmo Deeps Drilling at Cosmo and at the Aurora B discovery at Stawell.

Highlights and Key Drill Intercepts (Outside Mineral Resources Reported December 2014)

  • Development of the Sliver Lode at the Cosmo Mine with additional high grade results including: 14.79 g/t Au over 11.4 m (ETW 11.4 m) in hole CE67518 and 14.07g/t Au over 6.0 m (ETW 5.83 m) in hole CE67522.
  • The Sliver Lode drilling is approximately 25 m from current underground development highlighting the potential additional tonnes to be included in the near term mine plan.
  • Down plunge drilling in the footwall area of the Cosmo deposit, the Cosmo Deeps drill program has identified mineralization approximately 200 m down-plunge from the current base of Mineral Resources at Cosmo. The Cosmo Deeps drilling program was successful and include intercepts such as 5.85 g/t Au over 5.70 m (ETW 4.2 m) in hole CE84099 and 3.09 g/t Au over 6.4 m (ETW 5.0 m) in hole CE840100.
  • At Stawell a second phase of drilling in the Aurora B discovery target returned high-grade gold intercepts containing visible gold of 8.03 g/t Au (1) over 8.80 m (ETW 5.0 m) including 51.80 g/t Au (1) over 0.80 m (ETW 0.45 m) in hole MD6347.

(1) Visible gold present in drill intercept, ETW - Estimated True Width, All drill results are presented in Table 1 and 3

Mr. Douglas Forster, President and Chief Executive Officer, Newmarket Gold commented: "We are extremely pleased with the drilling results from the Sliver Lode and Cosmo Deeps down plunge targets which have intersected significant gold mineralization in previously undrilled areas close to current infrastructure at Cosmo. With these positive results, we continue to invest in additional drilling to advance the resource potential of these targets. At Stawell, continued drilling of the Aurora B discovery has returned additional high-grade results containing visible gold. These results combined with historical drilling, outline a mineralized surface approximately 140 m along strike and 140 m down dip with the Aurora B discovery remaining open for further expansion."

Mr. Forster continued: "To date, Newmarket's ongoing 2015 growth exploration programs totaling US$5.0 million have resulted in three exciting and significant gold discoveries, one at each of our operations including: the Eagle Fault discovery at Fosterville, the Aurora B discovery at Stawell and the Western Lodes discovery at Cosmo. In addition, drilling has also expanded the down plunge potential of the Sliver and Cosmo Deeps targets at Cosmo and the Lower Phoenix zone at Fosterville. All of Newmarket's growth exploration programs are designed to target significant resource expansion opportunities with the goal of increasing the life of mine reserves at our operations".

Cosmo Drilling Program

Approximately 16,700 m of exploration drilling has been completed at the Cosmo Mine since the start of 2015 with previously reported drill results for the Western Lodes and the Inner Metasediment programs released July 2015 (see Newmarket press release dated July 22, 2015). Further work has been completed on these areas with results expected to be released in the second half of 2015. In total, approximately US$3.0 million has been spent on exploration activities in the Northern Territory during 2015 with the majority of these expenditures targeting gold targets near infrastructure at Cosmo.

In addition to the results released in July 2015, drilling at Cosmo Mine continued to target the Sliver Lode, a mineralized lode located in the Hanging Wall of the F1 Fault located only 25 m from current underground mine development. Sliver Lode drilling suggests results could form part of the near term mine plan for the Cosmo Mine. Key intercepts from this drilling include 14.79 g/t Au over 11.4 m (ETW 11.4 m) in hole CE67518 and 14.07g/t Au over 6.0 m (ETW 5.83 m) in hole CE67522.

The Sliver Zone is a subsidiary fold on the Eastern Hanging-wall limb of the Cosmo anticline fold (Figure 1) and to date has produced a significant number of tonnes of mill feed for the Cosmo Mine. Previously the down plunge extension of the Sliver Zone was poorly understood and it was believed the mineralization terminated down plunge by the F1 fault. The latest results show that this is not the case and zone is still open at depth suggesting the potential to extend the current mine plan into the future. With this improved understanding of the Sliver Lode, a US$530,000 surface drill program is expected to commence to test the extent of mineralization down plunge. A schematic long section is available in Figure 2 and a view showing the mineralization with respect to current underground workings is available in Figure 3. Since Mineral Resources reported in December 2014, a total of 6,417 m of drilling in 37 NQ diamond holes have been completed on the Sliver Lode. A Mineral Resource and Mineral Reserve update for the Sliver Lode will be undertaken at year-end 2015 incorporating the recent and ongoing drilling results.

See results for the Sliver Lode drilling in Table 1 with collar information shown in Table 2.

Further to the drilling completed into the Sliver Lode, two drill holes, out of a four hole program, were completed on Cosmo Deeps and tested mineralization around 200 m down plunge of current base of reported Mineral Resources at Cosmo. Both diamond holes (CE84099 & CE840100) have returned significant results, such as 5.85 g/t Au over 5.70 m (ETW 4.29 m) in hole CE84099, see table 1, located within the 300 Lode. In addition to these significant results in the 300 Lode, a previously unidentified lode has been intersected in these two holes with results of 3.87 g/t Au over 9.3 m (ETW 7.2 m) in hole CE840100 and 2.37 g/t Au over 5.2 m (ETW 3.8 m) in hole CE84099. These intercepts are located approximately 500 m from current workings (Figure 2) and are significant. Near-term exploration at Cosmo Mine continues to focus on advancing the Mineral Resource potential of these zones.

The very encouraging Cosmo Deeps and Sliver drill results have identified an opportunity to drill the down plunge potential of these targets from surface. This program is expected to commence in late 2015 and will cover 2,000 m of drilling to allow for future infrastructure planning for the mine. This drilling is planned to intersect the mineralization around 100 m down plunge from recent Sliver Lode drilling results as well as around 80 m above the intercept in drill hole CE840100. This program has the potential to add significant mineralization extension to the Cosmo deposit.

Stawell Drilling Program

Newmarket is also pleased to announce further successful results during the second phase of the Aurora B discovery drill program at Stawell Gold Mines (Figure 4). This program is following up on drill results reported on July 22, 2015 where drilling focused on the Hampshire Lode on the East Flank of the Magdala Basalt, approximately 400-500 m below surface (Figure 5). The first phase of drilling included a high-grade gold intercept of 7.06 g/t Au (1) over 17.80 m (ETW 8.3 m) in MD6339 (reported July 22, 2015). The second phase of drilling, comprising four holes for 2,067 m returned high-grade gold intercepts containing visible gold of 8.03 g/t Au (1) over 8.80 m (ETW 5.0 m) including 51.80 g/t Au (1) over 0.80 m (ETW 0.45 m) and 2.59 g/t Au over 5.50 m (ETW 3.1 m) in hole MD6347. These high-grade results, when considered with historical drill results (Figure 6), demonstrate a mineralized surface of approximately 140 m along strike and 140 m down dip and the Aurora B discovery remains open for further expansion. Results are pending for the fourth and final hole.

Drilling of the Aurora A target has now commenced from underground and comprises two diamond holes for a total of 2,000 m. The Aurora A target is located vertically below the Aurora B discovery, and is separated by the South Fault, which has thrust the Aurora B upwards and to the southwest. The Aurora A target was previously known as "Wonga Gift" (Northgate Minerals Press Release, dated November 1, 2010) and has a significant historic drill intercept of 13.7 g/t Au over 5.45 m (ETW 4.90 m) from surface diamond hole SD649A (Figure 7). The present drill program has an estimated cost of US$250,000 and will test an area approximately 700 m along strike to the north from existing Aurora A drilling.

The Aurora targets on the East Basalt Flank represent near mine exploration targets in an area with no recorded production. In comparison, the West Basalt Flank has produced over 2.3 million ounces of gold. Exploration of the East Basalt Flank has been prioritized based on the more accessible Western Flank targets and the location of mine infrastructure, which is also situated on the west flank. Work has commenced on an exploration decline, 220 m in length to provide suitable drill platforms to support future Aurora B drill programs.

Both the Aurora A and B programs have demonstrated that targeted exploration activities at Stawell Gold Mines still have the opportunity for success. Through the detailed work by the Stawell Geology team reviewing both historical and current mining and exploration activities, targets such as the Aurora prospect can still be identified in close proximity to a mine that has been active since the Mid-1980's. Newmarket will continue to review and support targets, such as Aurora at Stawell, with the plan of attaining organic growth at our current mines.

All drill intercept results are shown in Table 3 and drill collars are presented in Table 4.

A location map of the Stawell operation can be seen in Figure 4.

Qualified Person

Mark Edwards, MAusIMM (CP), MAIG, General Manager, Exploration, Newmarket Gold, is a "qualified person" as such term is defined in National Instrument 43-101 and has reviewed and approved the technical information and data included in this press release.

QAQC information is provided at the bottom of Table 4.

ON BEHALF OF THE BOARD

Douglas Forster, M.Sc., P.Geo.

President & Chief Executive Officer

About Newmarket Gold Inc.

Newmarket Gold is a Canadian-listed gold mining and exploration company with three 100% owned operating mines across Australia. The Company is focused on creating substantial shareholder value by maintaining a strong foundation of quality gold production, over 200,000 ounces annually, generating free cash flow and maintaining a large resource base as it executes a clearly defined gold asset consolidation strategy. The Company is focused on sustainable operating performance, a disciplined approach to growth, and building gold reserves and resources while maintaining the high standards that the Newmarket Gold core values represent.

Table 1: Drill Assay Intercepts for Cosmo Underground Drilling Programs
Hole ID From
(m)
To
(m)
Downhole Interval
(m)
Estimated True Width (m) Gold Grade
(g/t Au)
Geological Structure
Sliver Drilling Results
CE67501 162.35 173 4.3 10.62 6.50 Sliver
and 178.35 182.75 4.4 4.39 2.04 Sliver
and 194.5 205.7 11.2 11.14 4.19 Sliver
and 249.75 253.5 3.8 3.71 2.69 Sliver
CE67502 No Significant Intercept
CE67504 113 118 5.0 4.54 2.97 Sliver
CE67505 99.3 106.6 7.3 7.01 3.22 Sliver
and 113.4 119 5.6 5.38 5.03 Sliver
CE67506 129 133 4.0 3.64 2.33 Sliver
CE67507 115 119 4.0 3.85 9.71 Sliver
CE67508 98.2 100.3 2.1 2.02 8.64 Sliver
and 136.25 138.9 2.7 2.55 2.47 Sliver
CE67509 107.8 113.5 5.7 4.15 9.90 Sliver
and 117.8 121 3.2 2.33 4.00 Sliver
CE67510 115.7 117.8 2.1 1.53 2.14 Sliver
CE67511 No Significant Intercept
CE67512 No Significant Intercept
CE67513 112.95 114.95 2.0 1.46 2.15 Sliver
CE67514 No Significant Intercept
CE67515 103.6 105.7 2.1 2.07 8.58 Sliver
CE67516 119 123.8 4.8 4.74 13.87 Sliver
and 135.3 139.5 4.2 4.15 5.44 Sliver
and 163.1 167 3.9 3.85 4.88 Sliver
CE67517 107.3 111 3.7 3.65 4.09 Sliver
CE67518 124.2 135.6 11.4 11.40 14.79 Sliver
CE67519 126.3 130.8 4.5 4.49 3.79 Sliver
CE67520 No Significant Intercept
CE67521 137 143.5 6.5 5.63 4.67 Sliver
CE67522 112 118 6.0 5.83 14.07 Sliver
CE67523 134.25 136.25 2.0 1.94 2.06 Sliver
CE67524 No Significant Intercept
CE67525 No Significant Intercept
CE67526 No Significant Intercept
CE67527 No Significant Intercept
CE67528 No Significant Intercept
CE67529 126.2 136.45 10.3 10.24 3.56 Sliver
and 160.2 165 4.8 4.80 4.44 Sliver
and 169 175 6.0 6.00 4.77 Sliver
CE67531 120.5 123.5 3.0 2.78 7.06 Sliver
CE67533 132.9 137 4.1 4.06 8.50 Sliver
CE67536 137 139 2.0 1.98 2.81 Sliver
CE67538 No Significant Intercept
CE67539 101.3 107.3 6.0 4.59 3.01 Sliver
CE69038 164.4 168 3.6 3.43 4.59 Sliver
and 179 184 5.0 4.76 2.00 Sliver
CE69043 151 155 4.0 3.73 4.36 Sliver
CE69048 186.1 190.4 4.3 4.25 2.15 Sliver
CE69052 181 185 4.0 4.00 2.66 Sliver
and 188.8 204.3 15.5 15.50 4.62 Sliver
and 210.6 218.2 7.6 7.60 5.26 Sliver
and 236 239.1 3.1 3.10 4.20 Sliver
Cosmo Deeps Drilling Results
CE84099 523 528.5 5.5 3.80 2.37 New
and 565.1 567.6 2.5 1.73 2.22 22
and 580 585.7 5.7 4.20 5.85 300
CE840100 294 297 3.0 2.30 3.89 22
and 336 339 3.0 2.31 2.51 22
and 352.9 356.6 3.7 2.87 2.05 22
and 474.5 478.75 4.3 3.29 16.17 22
and 615.45 624.7 9.3 7.21 3.87 New
inc. 3.7 2.90 6.21 New
and 691.75 702 10.3 8.07 2.75 300
inc. 6.4 5.04 3.09 300

Note: Drill results that are greater than 30 - Gram Metres are in bold text

Table 2: Cosmo Diamond Drilling Collar Locations (Cosmo Mine Grid)
Hole ID Northing Easting Elevation Collar
Azimuth
Collar
Plunge
Depth
(m)
Underground Diamond Drill Holes - Sliver
CE67501 1,826 4,917 678 360 -0.9 284.9
CE67502 1,827 4,916 678 342 -1.8 188.8
CE67504 1,827 4,917 680 358 25.6 144.7
CE67505 1,827 4,917 679 359 16.8 155.6
CE67506 1,827 4,917 680 347 24.5 164.8
CE67507 1,827 4,917 679 347 16.7 173.9
CE67508 1,827 4,917 680 352 31.0 155.5
CE67509 1,827 4,916 681 342 43.8 164.8
CE67510 1,827 4,916 680 343 33.9 152.9
CE67511 1,827 4,916 681 334 44.9 148.7
CE67512 1,827 4,915 681 335 34.3 158.9
CE67513 1,827 4,915 681 324 44.1 125.2
CE67514 1,827 4,915 680 327 34.2 122.3
CE67515 1,827 4,917 680 354 22.7 130.8
CE67516 1,827 4,917 679 347 9.5 182.5
CE67517 1,827 4,917 679 354 8.8 149.5
CE67518 1,827 4,917 678 354 3.2 161.9
CE67519 1,827 4,917 678 354 -1.8 185.9
CE67520 1,827 4,916 678 347 -2.5 218.2
CE67521 1,827 4,916 680 341 30.6 152.8
CE67522 1,827 4,917 679 353 16.5 141.8
CE67523 1,827 4,916 679 341 16.1 168.0
CE67524 1,827 4,916 678 341 3.6 174.1
CE67525 1,827 4,916 679 336 9.7 153.0
CE67526 1,827 4,916 681 334 33.9 55.3
CE67527 1,827 4,916 680 333 25.0 146.6
CE67528 1,827 4,916 679 328 16.6 145.9
CE67529 1,827 4,916 678 348 3.4 188.9
CE67531 1,827 4,916 680 341 25.0 150.0
CE67533 1,827 4,916 679 341 10.4 164.9
CE67536 1,827 4,916 679 335 17.0 146.6
CE67538 1,827 4,916 679 338 2.7 161.7
CE67539 1,827 4,916 681 156 40.1 350.5
CE69038 1,765 4,838 694 31 19.9 202.6
CE69043 1,766 4,838 694 24 22.9 196.7
CE69048 1,765 4,838 694 29 13.3 235.9
CE69052 1,766 4,838 693 24 4.3 311.7
Underground Diamond Drill Holes - Cosmo Deeps Program
CE84099 1,687 4,709 826 19 -42.6 636.0
CE840100 1,687 4,708 826 10 -40.4 752.6
Table 3: Drill Assay Intercepts for Stawell Underground Drilling Programs
Hole ID From (m) To (m) Downhole Interval (m) Estimated True Width (m) Gold
(g/t Au)
Geological Structure
MD6345 233.55 235.65 2.10 1.80 1.00 Moray Lode
and 267.10 267.95 0.85 0.70 3.45 Waterloo
and 283.85 284.90 1.05 0.90 5.44 East Contact
MD6346 214.90 222.80 7.90 5.90 0.70 Moray Lode
and 346.30 349.30 3.00 1.60 2.47 Waterloo
and 396.80 398.40 1.60 0.85 1.46 Hampshire Lode
MD6347 430.30 431.40 1.10 0.80 0.78 Waterloo
and 541.50 547.70 6.20 3.50 1.39 Hampshire Lode
and(1) 553.60 562.40 8.80 5.00 8.03 Hampshire Lode
including(1) 559.00 559.80 0.80 0.45 51.80 Hampshire Lode
and 568.80 574.30 5.50 3.10 2.59 Hampshire Lode
and 578.00 578.60 0.60 0.35 7.93 Hampshire Lode
MD6353 Results Pending

(1) Visible Gold Present in drill intercept

Table 4: Stawell Diamond Drilling Collar Locations (Stawell Mine Grid)
Hole ID Northing Easting Elevation Collar Azimuth Collar
Plunge
Depth (m)
MD6345 4,768 4,771 -118 43.4 -33.6 390.3
MD6346 4,768 4,770 -118 56.2 -41.5 485.9
MD6347 4,768 4,770 -118 42.1 -51.7 676.9
MD6353 4,768 4,770 -118 51.9 -47.3 515.8

Drilling and Assay QAQC

Newmarket Gold has in place quality-control systems to ensure best practice in drilling, sampling and analysis of drill core. All diamond drill hole collars (Table 2 and 4) are accurately surveyed using a Leica Total Stations instrument and down hole deviations are measured by electronic multi-shot cameras (Fosterville and Stawell) or by using a down hole Gyro instrument (Cosmo).

All reported drill intercepts are from NQ2 or NQ sized diamond drill core that was either whole core sampled or cut longitudinally in half with a diamond saw depending on the requirements to keep core for future reference. In the cases of sawn drill core, one-half of the drill-core was sent for assay and the other half retained for reference. Drill core sample intervals vary between 0.2 and 1.5m in length and were determined from logging of sulphide and visible gold. Where recognized in drill core all visible gold zones have been noted in the tables reported above.

Assay results are based on either a 30-gram (Stawell) or 50-gram (Cosmo) charge fire assay. Mean grades are calculated using a variable lower grade cut-off (generally 2 g/t Au) and maximum contiguous 2m internal dilution. No upper gold grade cut has been applied to the data. However, during future resource work the requirement for assay top cutting will be assessed.

Drill samples from the Cosmo Deposit were assayed at North Australian Laboratories Pty Ltd, an independent laboratory in Pine Creek, Northern Territory.

Drill samples from the Stawell Deposit were assayed at ALS Laboratories Pty Ltd, an independent laboratory in Orange, New South Wales.

All Mine Geology and Exploration teams conduct site audits and reviews from time to time at the independent laboratories as well as conduct intra-laboratory analysis of results to test the quality of reported results. All reviews of QAQC data has not identified any significant issues that cannot be resolved prior to results being used for modelling or reporting.

To view the figures associated with this release, please visit the following links:

http://media3.marketwire.com/docs/Figure_1-Cosmo_location_plan.pdf

http://media3.marketwire.com/docs/Figure_2-Cosmo_Long_section.pdf

http://media3.marketwire.com/docs/Figure_3-Cosmo_Sliver_Lode_sectional_view.pdf

http://media3.marketwire.com/docs/Figure_4-Stawell_Project_location_plan.pdf

http://media3.marketwire.com/docs/Figure_5-Stawell_mine_long_proj_showing_Aurora_targets.pdf

http://media3.marketwire.com/docs/Figure_6-Stawell_AuroraB_East_Flank_Targets_long_sec.pdf

http://media3.marketwire.com/docs/Figure_7-Stawell_AuroraA_East_Flank_Targets_long_sec.pdf

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