Pilot Gold Inc.

TSX : PLG


Pilot Gold Inc.

January 21, 2014 06:30 ET

Pilot Gold Reports 1.29% Supergene Copper Over 34.1 Metres at K2, TV Tower

Extensive supergene copper zone, indications of two porphyry Cu-Au systems along K2 trend

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan. 21, 2014) - Pilot Gold Inc. (TSX:PLG) ("Pilot Gold" or the "Company") is pleased to announce that drill results from the four-kilometre-long K2 trend reveal the presence of an extensive blanket of supergene copper mineralization underlying the oxide gold zones. In addition, drilling and surface work suggest that two or more copper-gold porphyry systems are present at K2, which includes the Kayali and Karaayi targets in the southern portion of TV Tower.

"The discovery and recognition of this copper component markedly changes the complexion of the K2 target and may be a game changer for the entire TV Tower property," said Matt Lennox-King, President and CEO, Pilot Gold. "It is potentially the most significant new development in the Biga district since the 2006 discovery of our Halilaga copper-gold porphyry deposit, 15 kilometres to the southeast of K2."

Supergene copper drill highlights from K2 include:

  • 1.29% copper (Cu) over 34.1 metres in KYD-39, including
    • 1.90% Cu over 20.8 m
  • 0.35% Cu over 65.0 m in KYD-43
  • 0.35% Cu over 64.2 m in KYD-34
  • 0.33% Cu over 57.0 m in KYD-03
  • 0.63% Cu over 41.7 m in KRD-005, including
    • 1.07% Cu and 0.10 g/t gold over 21.8 m

K2 porphyry systems:

Indications of porphyry Cu-Au mineralization at Karaayi were noted in surface outcrops to the south of, and under, the gold-bearing silica cap. Drilling by prior operators encountered gold and copper mineralization over significant lengths in the subsurface. Pilot Gold drilled two holes (KRD002 and KRD004) to target Cu-Au porphyry mineralization near the historic holes.

Karaayi Cu-Au porphyry target highlights:

  • 0.30% Cu and 0.13 g/t Au over 224.8 m in KRD002, including
    • 0.59% Cu and 0.18 g/t Au over 37.0 m
  • 0.16% Cu and 0.18 g/t Au over 154.4 m in KRD004
  • 0.19% Cu and 0.17 g/t Au over 257.2 m in KAD02
  • 0.29% Cu and 0.20 g/t Au over 93.0 m in KC03

Quartz stockwork and phyllic alteration consistent with the upper levels of a porphyry system were also noted immediately below the high sulphidation silica cap in KRD001 and KRD005. This suggests that porphyry alteration and mineralization may extend well outside of the currently defined porphyry target.

1200m by 400m copper-gold soil anomaly:

Grid soil sampling by Pilot Gold southwest of the Karaayi silica cap has also partially defined a large gold and copper in soil anomaly approximately 400 metres by 1200 metres and open to the southeast. Individual samples returned up to 1600 ppm copper and up to 830 ppb gold. Assays are pending on additional soil sampling to the southeast. An initial drill test on two permitted sites in the centre of the soil anomaly is planned for 2014, and geological mapping and soil and rock sampling are continuing at Karaayi. Porphyry-related quartz stockwork alteration has been observed in outcrop at this second porphyry target.

Pilot Gold drilled 3,586 metres in 17 holes in Kayali and 1,319 metres in 5 holes at Karaayi in 2013. Members of the Pilot Gold team played an important role in the discovery of the nearby Halilaga copper-gold deposit (Teck Resources 60% / Pilot Gold 40%).

All true widths are 50-100% of reported widths unless otherwise stated. All intervals of no sampling have been assigned zero grade for the purposes of compositing.

For a comprehensive table of results related to copper mineralization at Kayali, please click: http://www.pilotgold.com/sites/default/files/KayaliDrillResults1404.pdf

For a comprehensive table of results related to copper mineralization at Karaayi, please click: http://www.pilotgold.com/sites/default/files/KaraayiDrillResults1404.pdf

For a map of copper drill results at K2, please click:
http://www.pilotgold.com/sites/default/files/K2DrillMap1404.pdf

For a conceptual long section of copper-gold systems at Karaayi, please click:
http://www.pilotgold.com/sites/default/files/KaraayiCrossSection1404.pdf

K2 copper geology:

Throughout the K2 trend, gold is present in a shallow zone of strongly silicified and oxidized volcaniclastic rocks. The transition from oxide to sulphide below the gold zone hosts copper mineralization, primarily consisting of chalcocite and covellite. It is likely supergene in nature and derived from copper minerals originally deposited with, and subsequently leached from, the gold mineralization. While no metallurgical work has been carried out on this material, both chalcocite and covellite are typically amenable to heap leaching and/or extraction in a flotation circuit.

The supergene copper zone is up to 300 metres wide and 60 metres thick, and appears, based on limited drilling, to extend intermittently over the length of the K2 gold zone. The spatial juxtaposition of the epithermal and porphyry systems is significant, providing a telescoped (or collapsed) profile of continuous mineralization and a potentially deep rooted system.

About TV Tower:

TV Tower is a joint venture between Pilot Gold (40%) and Teck Madencilik Sanayi Ticaret A.S. (60%), a Turkish subsidiary of Teck Resources Limited ("Teck"). Pilot Gold is project operator at TV Tower and can increase its interest in the project to 60%, through sole funding of exploration over a three-year period.

Located on the Biga Peninsula of northwest Turkey, the TV Tower project encompasses 91 square kilometres containing more than a dozen targets ranging from high- and low-sulphidation epithermal gold-silver to porphyry gold-copper.

TV Tower is an early stage exploration project and does not contain any mineral resource estimates as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101"). The potential quantities and grades disclosed herein are conceptual in nature and there has been insufficient exploration to define a mineral resource for the targets disclosed herein. It is uncertain if further exploration will result in these targets being delineated as a mineral resource. There are furthermore no assurances that the geological similarities to Halilaga will result in the establishment of any resource estimate at the K2 target, or, if found to exist, that it will be of a similar grade or quantity to that found at Halilaga, or that the supergene copper zone at K2 can be advanced in a similar timeframe.

Moira Smith, Ph.D., P.Geo., Chief Geologist, Pilot Gold, is the Company's designated Qualified Person for this news release within the meaning of NI 43-101 and has reviewed and verified that the information contained in the release is accurate. Drill composites were calculated using cut-offs of 0.2, 0.5, 1.0 and 3.0 g/t Au. Drill intersections are reported as drilled thicknesses. True widths of the mineralized intervals are interpreted to be between 50-100% of the reported lengths. Drill samples were assayed by AcmeLabs in Ankara, Turkey and Vancouver, B.C. for gold by Fire Assay of a 30 gram (1 assay ton) charge with ICP-ES or AAS finish, or if over 5.0 g/t were re-assayed and completed with a gravimetric finish. Ag and Cu were determined by ICP-MS, with overlimits (greater than 100 ppm Ag or greater than 10,000 ppm Cu) completed by fire assay with gravimetric finish (Ag) or 4-acid digestion with ICP-ES finish (Cu). QA/QC included the insertion and continual monitoring of numerous standards and blanks into the sample stream, and the collection of duplicate samples at random intervals within each batch.

Holes KAD 1-10 were drilled by Chesser Resources Limited. Pilot Gold possesses original certificates, QA-QC data and reliable collar and downhole data such that Pilot Gold has no reason to believe that the information is inaccurate. Holes KC02-KC08 were drilled by Tuprag Metal Madencilik, a subsidiary of Eldorado Gold Corporation. Pilot Gold is in possession of collar and downhole data, and has reviewed copies of certificates and evidence that they carried out QA-QC programs. Dr. Smith has no reason to believe that the information is inaccurate.

About Pilot Gold:

Pilot Gold is a well-funded gold exploration company led by a proven technical team that continues to discover and define high-quality projects featuring strong grades, meaningful size and mining-friendly addresses. Our three key assets include interests in the TV Tower and Halilaga projects in Turkey, and the Kinsley Mountain project in Nevada, each of which has the ability to become a foundational asset. We also have a pipeline of projects characterized by large land positions and district-wide potential that can meet our growth needs for years to come.

For more information, visit www.pilotgold.com.

Further information is available in the technical report entitled "Updated Technical Report on the TV Tower Exploration Property, Çanakkale, Western Turkey", effective July 15, 2012 and dated August 3, 2012, prepared by Paul Gribble, B.Sc., C.Eng., FIMMM, UK Manager, Geology of Tetra Tech WEI Inc., under Pilot Gold's Issuer Profile on SEDAR (www.sedar.com).

All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to Pilot Gold within the meaning of applicable securities laws, including statements regarding the size of the supergene copper zone, the significance of the drill results to the overall development of the TV Tower project, that address timing of exploration and development plans at the Company's mineral projects. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "planned", "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", and similar expressions, or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "should", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions about future prices of gold, copper, silver and other metal prices, currency exchange rates and interest rates, favourable operating conditions, political stability, obtaining governmental approvals and financing on time, obtaining renewals for existing licences and permits and obtaining required licences and permits, labour stability, stability in market conditions, availability of equipment, accuracy of any mineral resources and mineral reserves, successful resolution of disputes and anticipated costs and expenditures. Many assumptions are based on factors and events that are not within the control of Pilot Gold and there is no assurance they will prove to be correct.

Such forward-looking information, including, but not limited to, statements that address reserve or resource potential, potential quantity and/or grade of minerals, potential size of a mineralized zone, potential expansion of mineralization, the timing and results of future resource estimates, proposed timing of exploration and development plans at the Company's mineral projects, and the estimation of mineral reserves and resources involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of Pilot Gold to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information.

Such factors include, among others, risks related to the interpretation of results at certain of our exploration properties, reliance on technical information provided by our joint venture partners or other third parties as related to any of our exploration properties; changes in project parameters as plans continue to be refined; successfully completing the earn-in on the TV Tower project, including the ability to incur the minimum annual Expenditure Requirements to complete the earn-in agreement; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; current and proposed exploration and development; the costs and timing of the development of new deposits; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; uses of funds in general including future capital expenditures, exploration expenditures and other expenses for specific operations; the timing and success of exploration activities generally; achievement of identified tangible project milestones at TV Tower; delays in permitting; satisfaction of Turkish requirements relating to the periodic submissions of Environmental Impact Assessments ("EIAs"); possible claims against the Company or its joint venture partners; resolution of claims and challenges to EIAs, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, financing or in the completion of exploration as well as those factors discussed in the Annual Information Form for the year ended December 31, 2012, dated March 27, 2013 (the "AIF") in the section entitled "Risk Factors", under Pilot Gold's SEDAR profile at www.sedar.com.

Although Pilot Gold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Pilot Gold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise. Accordingly, readers should not place undue reliance on forward-looking information. Further details relating to Pilot Gold are also available in our AIF, available under Pilot Gold's SEDAR profile at www.sedar.com.

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