Probe Mines Limited
TSX VENTURE : PRB

Probe Mines Limited

April 02, 2012 12:37 ET

Probe Mines Announces Significant Improvement and Expansion of the Borden Lake Gold Zone: 44% Increase in Global Resource Estimate and New Pit-Constrained and High-Grade Resource Estimates

TORONTO, ONTARIO--(Marketwire - April 2, 2012) - Probe Mines Limited (TSX VENTURE:PRB) -

Highlights:

• Borden Lake gold zone estimated to contain a Global Indicated Resource of 4,051,000 ounces of gold averaging 0.71 g/t gold and an additional Inferred Resource of 1,796,000 ounces of gold averaging 0.62 g/t gold, at a 0.3 g/t cut-off grade;

• Borden Lake gold zone estimated to contain a Pit Constrained Indicated Resource of 2,735,000 ounces of gold averaging 1.04 g/t gold and an additional Inferred Resource of 683,000 ounces of gold averaging 0.93 g/t gold, at a 0.6 g/t cut-off grade;

• Borden Lake gold zone estimated to contain a distinct, higher-grade zone with an Indicated Resource of 1,498,000 ounces of gold averaging 1.46 g/t gold and an additional Inferred Resource of 407,000 ounces of gold averaging 1.30 g/t gold, at a 1.0 g/t cut-off grade;

• Increase of 1228% in the Indicated category from the Initial Global Resource Estimate, from 305,000 ounces to 4,051,000 ounces of gold, at a 0.3 g/t cut-off grade. Indicated average grades consistently higher as compared to Inferred average grades;

• Overall increase of 44% in total contained ounces of gold from the Initial Global Resource Estimate, at a 0.3 g/t cut-off grade;

• The Borden Lake zone also contains a resource of 3,820,000 ounces of silver in the Indicated category, and 1,960,000 ounces of silver in the inferred category, at a 0.3 g/t gold cut-off grade.

Probe Mines Limited (TSX VENTURE:PRB) ("Probe" or the "Company") is pleased to announce that the Company has received the Updated Mineral Resource Estimate for its Borden Lake gold deposit from Micon International Limited ("Micon").

The Updated Resource Estimates represents a rigorous evaluation of the drilling completed to the end of February 2012, and comprises results from 159 holes drilled on the Borden Lake gold zone since its discovery just 15 months ago. The results of the Updated Resource Estimate show significant improvement of the deposit in terms of upgrading the Resource category through the conversion of Inferred Resources into Indicated (up to 1228% increase); expansion of the deposit through addition of new Indicated and Inferred Resources (up to 44% increase); and delineation of a discernible higher-grade core (>1.4 g/t gold). In all aspects, the deposit has shown enhancement from the Initial Resource Estimate (see News Release dated August 23, 2011) and increased confidence in the gold mineralization, including significantly higher-grades in Indicated Resources compared to the Inferred. Owing to the effectiveness of the current resource estimation in improving the Borden Lake deposit, the Company is preparing to commence further studies in the form of a Preliminary Economic Assessment ("PEA") or Scoping study.

In an effort to provide continuity for investors from the Initial Global Resource Estimate (not constrained by a pit shell), the Updated Resource Estimate will be presented again as a Global Resource Estimate at the same cut-off grade (0.3 g/t Au); followed by a Constrained Resource Estimate (within a pit shell) at a higher cut-off grade (0.6 g/t Au); and a Global Resource Estimate focused on the higher-grade core of the deposit. The latter higher-grade zone is an important aspect of the deposit not elaborated on during the Initial Resource Estimate, but distinguishes Borden Lake from many low-grade deposits. The higher-grade core zone, which is estimated from block modeling of the higher cut-off grades to contain an estimated Indicated Resource of 1,498,000 ounces of gold at an average grade of 1.46 g/t and an additional 407,000 ounces of gold at an average grade of 1.30 g/t gold in the Inferred category, provides the potential for a more robust mineralized zone within the deposit, which may have positive implications for the initial phase of any possible development scenarios.

Global Updated Resource Estimate

The Global Updated Resource Estimate, presented in the following "sensitivity" table at various cut-off grades shows, at the 0.3 g/t cut-off, an Indicated Resource of 4,051,000 ounces of gold averaging 0.71 g/t Au plus an additional Inferred Resource of 1,797,000 ounces Au averaging 0.62 g/t Au, representing an increase of 1,228% in Indicated Resource from the previous Inferred category in the Initial Resource Estimate and a 44% increase in the total contained ounces from the Initial Resource Estimate while maintaining a similar overall average grade.

Comparison of Updated and Initial Global Resource
Estimates (0.3 g/t Au cut-off)
Resource Estimate Indicated (ozs Au) Inferred (ozs Au)
Updated (March 2012) 4,051,000 1,797,000
Initial (August 2011) 305,000 3,755,000

The following two tables summarize the Borden Lake gold mineral resource estimate in the indicated and inferred resource categories, respectively, at various cut-off grades. The figures are cumulative for each successive cut-off grade. An interesting feature of the Updated Global Resource Estimate is the difference between the average grades for Indicated and Inferred Resources, with Indicated average grades ranging between 12% and 16% higher than the Inferred, for all cut-off grades. It is expected that this trend of increasing grades will continue with further drilling and upgrading of the Inferred resources.

For the purpose of this press release, and to maintain continuity from the previous Initial Resource Estimate, the Company is reporting the figures at the 0.3 g/t cut-off grade for the Updated Global Resource Estimate:

Global Indicated Mineral Resource Estimate
Cut-Off
Au g/t
Cumulative
Tonnes
Average
Au g/t
Cumulative
Au oz
Average
Ag g/t
Cumulative
Ag oz
>1.5 10,155,000 2.01 656,000 1 320,000
1 31,910,000 1.46 1,498,000 0.9 905,000
0.7 65,477,000 1.14 2,394,000 0.8 1,700,000
0.6 82,872,000 1.03 2,757,000 0.8 2,065,000
0.5 105,635,000 0.93 3,159,000 0.7 2,508,000
0.4 135,522,000 0.82 3,589,000 0.7 3,063,000
0.3 176,959,000 0.71 4,051,000 0.7 3,820,000
0.2 233,461,000 0.6 4,501,000 0.6 4,728,000
No cut 305,220,000 0.49 4,827,000 0.6 5,771,000
Global Inferred Mineral Resource Estimate
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative
Ag oz
1,2
>1.5 2,105,000 1.74 118,000 0.9 64,000
1 9,728,000 1.3 407,000 0.9 281,000
0.7 24,974,000 1.01 810,000 0.8 649,000
0.6 34,924,000 0.91 1,017,000 0.8 864,000
0.5 49,173,000 0.8 1,268,000 0.7 1,157,000
0.4 68,702,000 0.7 1,549,000 0.7 1,536,000
0.3 90,817,000 0.62 1,796,000 0.7 1,960,000
0.2 123,154,000 0.52 2,052,000 0.7 2,597,000
No cut 184,179,000 0.39 2,315,000 0.6 3,676,000
1. Tonnes and ounces have been rounded to the nearest thousand
2. Figures/numbers for resource tonnes and ounces may not tally due to rounding

The Global Resource also contains a resource of 3,820,000 ounces of silver in the Indicated category, and 1,960,000 ounces of silver in the inferred category, at a 0.3 g/t gold cut-off grade.

Constrained Updated Resource Estimate

For the Updated Resource Estimate, the Global Resource was constrained in a preliminary Whittle open-pit design. The preliminary pit was designed to a maximum depth of about 450 m, and contains an Indicated Resource of 2,735,000 ounces averaging 1.04 g/t Au and an Inferred Resource of 683,000 ounces averaging 0.93 g/t Au, at a 0.6 g/t cut-off grade. A 0.6 g/t cut-off was chosen in order to bring the overall average grade of the Pit-Constrained Resource to just over 1 g/t Au, which makes it comparable to many of the other known low-grade/bulk-tonnage deposits with reported Resource Estimates. The following table presents the constrained Resource Estimate for mineralization falling within the preliminary pit shell, assuming a gold price of $1,200 and a metallurgical recovery of 92%, amongst other assumptions further noted.

An image of the Pit-Constrained Resource is available on the Company's website at www.probemines.com.

For the purpose of this press release, the Company is reporting the figures for the Pit-Constrained Resource Estimate at the 0.6 g/t cut-off grade:

Pit-Constrained Indicated Mineral Resource Estimate3,4,5
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative Ag oz
1,2
>1.5 10,149,000 2.01 656,000 1 320,000
1 31,877,000 1.46 1,497,000 0.9 904,000
0.7 64,984,000 1.14 2,380,000 0.8 1,686,000
0.6 81,942,000 1.04 2,735,000 0.8 2,042,000
0.5 103,286,000 0.94 3,112,000 0.7 2,458,000
0.4 130,908,000 0.83 3,508,000 0.7 2,966,000
0.3 168,129,000 0.73 3,925,000 0.7 3,633,000
0.2 210,227,000 0.63 4,263,000 0.6 4,310,000
No cut 262,015,000 0.53 4,496,000 0.6 5,044,000
Pit-Constrained Inferred Mineral Resource Estimate
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative
Ag oz
1,2
>1.5 1,535,000 1.77 87,000 1 51,000
1 6,853,000 1.31 290,000 1 212,000
0.7 17,130,000 1.02 561,000 0.9 485,000
0.6 22,947,000 0.93 683,000 0.8 625,000
0.5 29,994,000 0.84 807,000 0.8 795,000
0.4 37,905,000 0.76 921,000 0.8 974,000
0.3 45,971,000 0.68 1,012,000 0.8 1,163,000
0.2 56,735,000 0.6 1,097,000 0.8 1,431,000
No cut 82,670,000 0.45 1,207,000 0.7 1,940,000
1. Tonnes and ounces have been rounded to the nearest thousand
2. Figures/numbers for resource tonnes and ounces may not tally due to rounding
3. Mineral Resources are estimated at a gold value of $1,200
4. No grade capping was required for the Resource Estimate
5. A bulk Density of 2.77 g/cm3 was used

At the same 0.6 g/t Au cut-off grade the transition from the Global Resource to the Pit-Constrained Resource represents only a loss of 9% of the total contained ounces, and mainly at either end of the deposit. This suggests that the orientation of the Borden Lake gold zone, which is dipping at 45 degrees, is well suited for open-pit extraction. Continued drilling will focus on further delineation of the mineralized zone with a view to expanding the pit design along strike and at depth.

Higher-Grade Global Resource Estimate

The Borden Lake gold zone is characterized by a persistent higher-grade core surrounded by lower-grade mineralization. The deposit therefore lends itself to more detailed evaluation based on this apparent grade distribution. The deposit's block model at cut-off grades of 0.75 g/t and 1.0 g/t Au shows a distinct zone of higher-grade gold mineralization identifiable along the entire strike length of the deposit and at depth. This core of the Borden Lake gold zone contains an Estimated Resource of 1,498,000 ounces at an average grade of 1.46 g/t Au in the Indicated category and 407,000 ounces at an average grade of 1.30 g/t in the Inferred category, at a cut-off grade of 1 g/t Au. Images of the block models at the 0.75 g/t and 1.0 g/t Au cut-off grades showing the remarkable continuity of the gold mineralization are available on the Company's website at www.probemines.com.

The higher grade mineralized zone may become an important feature in further studies of the viability of the deposit. The potential for exploitation of a higher-grade zone could provide alternative development scenarios which would be more realistically achievable and less sensitive to the parameters affecting most low-grade, bulk tonnage deposits.

The following table presents the Global Resource Estimate for this proposed higher-grade body, at cut-off grades between 0.75 g/t and 1.5 g/t Au. For the purpose of this press release, the Company is reporting the figures for the Global Higher-Grade Resource Estimate at the 1.0 g/t cut-off grade:

Higher-Grade Global Indicated Mineral Resource Estimate
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative
Ag oz
1,2
>1.5 10,155,000 2.01 656,000 1.0 320,000
1 31,910,000 1.46 1,498,000 0.9 905,000
0.75 57,954,000 1.19 2,219,000 0.8 1,533,000
Higher-Grade Global Inferred Mineral Resource Estimate
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative
Ag oz
1,2
>1.5 2,105,000 1.74 118,000 0.9 64,000
1 9,728,000 1.30 407,000 0.9 281,000
0.75 20,963,000 1.06 717,000 0.8 558,000
1. Tonnes and ounces have been rounded to the nearest thousand
2. Figures/numbers for resource tonnes and ounces may not tally due to rounding

In the Pit-Constrained Resource, the high-grade zone is well represented, with minimal loss of total contained ounces at the 1 g/t cut-off grade, particularly in the Indicated Resource category. The following table shows the Pit-Constrained Resources at cut-off grades between 0.75 g/t and 1.5 g/t Au. For the purpose of this press release, the Company is reporting the figures for the Pit-Constrained Higher-Grade Resource Estimate at the 1.0 g/t cut-off grade:

Higher-Grade Pit-Constrained Indicated Mineral Resource Estimate3,4,5
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative
Ag oz
1,2
>1.5 10,149,000 2.01 656,000 1 320,000
1 31,877,000 1.46 1,497,000 0.9 904,000
0.75 57,605,000 1.19 2,209,000 0.8 1,522,000
Higher-Grade Pit-Constrained Inferred Mineral Resource Estimate3,4,5
Cut-Off
Au g/t
Cumulative
Tonnes
1,2
Average
Au g/t
Cumulative
Au oz
1,2
Average
Ag g/t
Cumulative
Ag oz
1,2
>1.5 1,535,000 1.77 87,000 1 51,000
1 6,853,000 1.31 290,000 1 212,000
0.75 14,592,000 1.07 503,000 0.9 423,000
1. Tonnes and ounces have been rounded to the nearest thousand
2. Figures/numbers for resource tonnes and ounces may not tally due to rounding
3. Mineral Resources are estimated at a gold value of $1,200
4. No grade capping was required for the Resource Estimate
5. A bulk Density of 2.77 g/cm3 was used

Summary

The Updated Resource Estimate highlights a number of key features of the Borden Lake deposit, including:

  • The notable presence of a persistent, distinguishable, higher-grade zone within the block model which may positively influence future economic studies
  • Significant improvement of, and confidence in, the deposit through upgrade of the majority of previous Inferred Resources into the Indicated category
  • Increasing the total contained ounces in the Global Resource Estimate by 44% through additions to both the Indicated and Inferred categories.
  • Whittle open-pit design demonstrated that Borden Lake is ideally oriented for open-pit design, with an approximate 45 degree dip which roughly parallels the pit-slope walls.
  • At a vertical depth of about 450 m, the pit contains over 90% of the Global Resource, at the same cut-off grades. The minor loss is mostly due to the lack of further delineation of the deposit, which should be remedied by future drilling.

The Updated Resource Estimate represents a rigorous estimation and evaluation of Borden Lake, and will therefore be very effective in advancing the project. With the completion of the Updated Resource Estimate, the Company is now preparing to take the project forward by initiating a PEA or Scoping study to further evaluate the viability of the project in terms of potential development. Owing to the proximity of the deposit to the town of Chapleau, its location less than one kilometer from road and power and the consistency of mineralization, the Company is confident that Borden Lake will continue to distinguish itself.

Dr. David Palmer, President of Probe, states "We are extremely pleased with the results of the Updated Resource Estimate as it shows the remarkable progress we have made in the 15 short months since the discovery of the deposit. These results confirm the continued improvement of the deposit, as well as highlighting its distinctive higher-grade core, something not present in many other low-grade/bulk tonnage deposits. Borden has consistently shown positive results and we feel this Resource Estimate justifies the initiation of an economic assessment. Our focus now will be to accelerate this progress while continuing to expand the deposit and explore for other similar mineralized zones. Borden Lake has come a long way in a brief time, and we see much more potential for this project in the future."

The resource estimate, which meets the guidelines for reporting mineral exploration programs as set out in National Instrument 43-101, was based on 159 diamond drill holes that tested the gold horizon along approximately 2,100 metres (m) of strike length and to a vertical depth of approximately 416 m at a spacing of between 50 m to 100 m. Mineralization at Borden Lake is comprised of a volcano-/meta-sedimentary horizon containing a thick, continuous and consistent zone of gold-bearing disseminated sulphide mineralization. The deposit still remains open in all directions.

Mineral resources do not have demonstrated economic viability. The estimate of mineral resources may also be materially affected by other relevant factors or issues. There is no guarantee that the project will be placed into production. Micon is currently in the process of completing the NI 43-101 Technical Report supporting the estimate and the Technical Report will be filed within 45 days of this press release with SEDAR.

The mineral resource estimate was calculated using both Ordinary Kriging and Inverse Distance Cubed methods, which gave similar results. The reported figures are taken from the Inverse Distance Cubed modeling, which provides better definition of the higher grade portions. The mineralized material was classified into the Indicated or Inferred mineral resource category on the basis of a combination of the following factors: (a) confidence in the geological and mineralization continuity, (b) position of blocks in relation to the range of influence as defined by the variographic analysis and (c) and the search ellipse ranges. The Borden Lake gold deposit Indicated resource has been categorized taking into account the search parameters in relation to variographic results, and the observed geological and mineralization continuity based on sectional interpretation.

The reported cut-off grade of 0.6 g/t Au is based on consideration of other gold deposits that show similarity in volume and grade to Borden Lake.

The on-going drill program at Borden Lake is now on Hole BL12-182 and is designed to continue improving and expanding the resource. In addition to infill drilling within the area of the resource estimate, drilling is also focused on expanding the limits of the mineralization and further defining parallel gold zones observed. The Company currently has four drills turning on the project, and is expanding its exploration program with the recent option of Reliant Gold's Borden Lake South property. Summer programs will also focus on local and regional mapping, geophysical and soil geochemical programs. Second phase metallurgical investigations are already in progress.

Micon International Limited (Micon)

The Resources in this report were estimated by Micon in accordance with the definitions contained in the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Reserves Definitions and Guidelines that were prepared by the CIM Standing Committee on Reserve Definitions and adopted by the CIM Council on November 27, 2010. A supporting Technical Report will be filed under the Company's profile on SEDAR in the time allotted. The Micon personnel responsible for this Mineral Resource Estimate are Charley Z. Murahwi, M.Sc., P. Geo., FAusIMM and Alan J. San Martin, MAusIMM(CP). Messrs Murahwi and San Martin are Qualified Persons as defined in NI 43-101, and are independent of Probe Mines Limited. Micon acknowledges that it has read this news release and approves of its contents.

About Probe Mines:

Probe Mines Limited is a well financed, Canadian base and precious metal exploration company with approximately $33MM in treasury and a portfolio of highly prospective mineral properties. The Company is actively exploring a significant new gold resource on its Borden Lake project near Chapleau, Ontario and owns 875 claims covering approximately 14,000 hectares in the McFauld's Lake area, including a 100% interest in the Black Creek chromite deposit. Probe also maintains a 5% net smelter royalty on a portion of Agnico Eagle's Goldex Mine near Val d'Or, Quebec, which began production in 2008, and a 45% interest in a joint venture property with Lake Shore Gold Corp, which surrounds Lake Shore's Timmins Mine project. The Company's shares trade on the TSX Venture Exchange under the symbol PRB.

David Palmer, Ph.D., P.Geo., is the qualified person for all technical information in this release. To find out more about Probe Mines Limited, visit our website at www.probemines.com.

Forward-Looking Statements

This News Release includes certain "forward-looking statements". These statements are based on information currently available to the Company and the Company provides no assurance that actual results will meet management's expectations. Forward-looking statements include estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results relating to, among other things, results of exploration, project development, reclamation and capital costs of the Company's mineral properties, and the Company's financial condition and prospects, could differ materially from those currently anticipated in such statements for many reasons such as: changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with the activities of the Company; and other matters discussed in this news release. This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. The Company does not undertake to update any forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws.

Shares Issued: 64,872,922

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.

Contact Information

  • Probe Mines Limited
    David Palmer
    President
    (416) 777-6703

    Probe Mines Limited
    Karen Willoughby
    Investor Relations
    (866) 936-6766
    www.probemines.com