US Gold Corporation
TSX : UXG
AMEX : UXG

US Gold Corporation

December 21, 2006 08:30 ET

U.S. Gold: Tonkin Exploration Update 20 of 26 Holes Return Encouraging Results

Drilling Indicates New Mineralization at Depth

DENVER, COLORADO--(CCNMatthews - Dec. 21, 2006) - US GOLD CORPORATION (TSX:UXG)(AMEX:UXG) is pleased to announce continuing exploration results at its Tonkin project located in Nevada's Cortez Trend, 10 miles to the south of Barrick's rich Cortez Hills gold deposit. Drilling commenced in June and has been focused in areas near previously defined mineralized material containing 1.4 million ounces of gold. The current $30 million exploration program was launched in June 2006, building on an experienced team of Nevada-based professionals with prior big-company and entrepreneurial experience.

"The team we have assembled has completed property-wide re-evaluations, updating geologic mapping, geochemical sampling, and geophysical data. As well, a unique partnership with NASA has provided US Gold access to state-of-the-art exploration technologies aiding in our efforts. This work has greatly contributed to our overall understanding of the gold-bearing system," said Rob McEwen, Chairman and CEO. "It is still early, but we are encouraged by the fact that 20 of the 26 holes completed to date have encountered gold mineralization."

EXPLORATION RESULTS

The first phase of the exploration program at Tonkin is designed to test for lateral and depth extensions of the previously identified mineralized material as well as to identify favorable gold host rocks and dominant mineralizing structures. Drilling to date has been confined to the region known as the Mine Corridor, which is comprised of three areas: Southern, Middle and Rooster (see Figure 1). Next year we will be drilling outside the Mine Corridor on other targets defined by mapping, geochemistry and remote sensing. Twenty-six holes have been drilled and assayed, and an additional fourteen holes, including three monitoring wells, have assays pending. So far 55,000 feet of drilling has been completed, approximately thirteen percent of the proposed program, with assays received for the first 33,500 feet.

SOUTHERN AREA

New Mineralization Encountered

A cumulative total of eight holes have been drilled in the Southern Area of the Tonkin property. Angle Hole 16 encountered new mineralization in numerous intervals starting at an approximate vertical depth of 490 ft and reaching a depth of 780 feet, the deepest mineralization discovered since the program began. Results (see Table 1) from Hole 16 include:



(opt equals ounces per ton gpt equals grams per tonne)

Hole 16 0.069 gold opt over 30 ft. (2.355 gold gpt over 9.15 m)
including 0.135 gold opt over 12 ft. (4.617 gold gpt over 3.66 m)

(2nd interval) 0.080 gold opt over 31.5 ft. (2.751 gold gpt over 9.60 m)
including 0.111 gold opt over 15 ft. (3.790 gold gpt over 4.57 m)
including 0.090 gold opt over 6.5 ft. (3.085 gold gpt over 1.98 m)


Holes 7 and 8 were drilled to the east and west of Hole 16, and encountered lower grade mineralization to vertical depths of approximately 560 feet and 490 feet, respectively.

Hole 22 was drilled to test the southern extension of mineralization encountered in Hole 16 in a relatively untested region of the Southern Area. New gold mineralization was encountered in the shallow portions of the hole (45 feet at 0.041 gold opt), and scattered low grade gold intervals were encountered at depth.

Also in the Southern Area, Hole 23 was drilled to confirm gold mineralization identified in historic drilling and to determine its controls and orientation. Highlights include:



Hole 23 0.072 gold opt over 11 ft. (2.475 gold gpt over 3.35 m)
including 0.242 gold opt over 3 ft. (8.300 gold gpt over 0.91 m)

(2nd interval) 0.088 gold opt over 43.5 ft. (3.018 gold gpt over 13.26 m)
including 0.168 gold opt over 10.5 ft. (5.755 gold gpt over 3.20 m)
0.086 gold opt over 7.5 ft. (2.940 gold gpt over 2.29 m)
0.140 gold opt over 3 ft. (4.810 gold gpt over 0.91 m)


These results confirmed the validity of previous drilling and suggest that mineralization is hosted in relatively flat-lying receptive rock units and is open to the southwest. More drilling is planned in this area to further define orientation, extent and control of the favorable gold grades encountered in Hole 23.

MIDDLE AREA

Newly Initiated Drilling

Drilling in the Middle Area recently started to test for extensions of known near-surface mineralization. Hole 15 was drilled in a newly defined target area approximately 2,000 feet west of previous drilling. It encountered trace gold with thick sections of anomalous arsenic, antimony, and mercury, which are indicators of a Carlin-style gold system. Additional drilling is currently in progress in the Middle Area, focusing on northeast and northwest trending structures and their intersections.

ROOSTER AREA

Pursuit of Feeders and Extensions

The Rooster Area is the strongest expression of Carlin-style mineralization currently identified on the Tonkin project. It is characterized by broad and deep alteration, structurally controlled mineralization, and good gold grades indicating a receptive gold bearing system.

Drilling in the northern Rooster Area has been designed to test for down-dip and lateral extensions of known mineralization along northeast and north-northwest striking controls defined by detailed mapping, geophysics and historical drilling. These structures and their intersections will continue to be the target of exploration at Rooster in 2007.

Hole 4 was completed in the northwestern portion of the Rooster Area. It is 600 feet to the northwest of Hole 1 which returned a 40-foot intercept of 0.113 gold opt as discussed in the September 6 news release. Hole 4 intercepts include:



Hole 4 0.042 gold opt over 25 ft. (1.453 gold gpt over 7.62 m)
Including 0.063 gold opt over 15 ft. (2.147 gold gpt over 4.57 m)


Holes 21 and 26 were drilled to test the northern extension of Rooster mineralization. These holes are situated 560 feet north of previous drilling in untested areas and encountered numerous intervals of gold mineralization, including:



Hole 21 0.025 gold opt over 20 ft. (0.845 gold gpt over 6.10 m)
0.028 gold opt over 38 ft. (0.957 gold gpt over 11.52 m)
0.053 gold opt over 10 ft. (1.818 gold gpt over 3.05 m)

Hole 26 0.037 gold opt over 21 ft. (1.270 gold gpt over 6.40 m)


This area will continue to be explored for gold mineralization in favorable rock horizons and along structures and intersections.

Hole 30 was completed within the envelope of historic drilling at Rooster, to confirm previous vertical drilling that reached approximately 500 feet. This angle hole encountered mineralization to a depth of approximately 510 vertical feet. The best intercepts from Hole 30 begin at the surface and are summarized below:



Hole 30 0.039 gold opt over 145 ft. (1.319 gold gpt over 44.21 m)
including 0.081 gold opt over 50 ft. (2.786 gold gpt over 15.24 m)
including 0.180 gold opt over 10 ft. (6.170 gold gpt over 3.05 m)


All the results to date are summarized in Table 1.

Drilling to date has identified lateral extensions of known mineralized structures as well as some deeper gold intersections that have reinforced management's belief in the potential of US Gold's property. The Company has eight drill rigs on the Tonkin property, with plans to increase the pace of exploration in 2007.

QUALIFIED PERSON

This news release has been prepared under the guidance of Steve Brown, Senior Geologist and Project Manager, who is a Qualified Person as defined by National Instrument 43-101 and is responsible for program design and quality control of exploration undertaken by the Company at its Tonkin Springs property. All samples were analyzed by ALS Chemex of Winnemucca, Nevada.

All assays are uncut, with analysis conducted by ALS Chemex utilizing a 30 gram fire assay change with an AA finish. Sample length is by geologic boundary with a maximum 5 foot length and core recovery averages 95-98%. Quality assurance/quality control is assured by inserting standards and blanks every 40th sample and check assays sent to second lab every 20th sample.

Certain statements contained herein and subsequent oral statements made by and on behalf of the Company may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are identified by words such as "intends," "anticipates," "believes," "expects" and "hopes" and include, without limitation, statements regarding the Company's plan of business operations, potential contractual arrangements, receipt of working capital, anticipated revenues and related expenditures. Factors that could cause actual results to differ materially include, among others, those set forth in the Company's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 and those set forth in the registration statements referenced above, under the caption "Risk Factors." Most of these factors are outside the control of the Company. Investors are cautioned not to put undue reliance on forward-looking statements. Except as otherwise required by applicable securities statutes or regulations, the Company disclaims any intent or obligation to update publicly these forward looking statements, whether as a result of new information, future events or otherwise.



Table 1 - Assay Results

---------------------------------------------------------------------------
---------------------------------------------------------------------------
Hole Target Hole Assay Interval Gold Assay Gold Assay Purpose &
No. Area Length From To Length Ounces Length Grams Results
(feet) (feet) feet) (feet) per (meters) per
(Angle) ton tonne
---------------------------------------------------------------------------
SOUTHERN AREA
---------------------------------------------------------------------------
8 Southern 2390 15 35 20 0.027 6.10 0.922 Encounte-
Area red mine-
(-50 ralizati-
degrees) 160 170 10 0.032 3.05 1.105 on appro-
220 230 10 0.017 3.05 0.589 ximately
330 340 10 0.021 3.05 0.733 200 feet
490 500 10 0.015 3.05 0.526 below pr-
625 635 10 0.035 3.05 1.184 evious
shallow
drilling
---------------------------------------------------------------------------
9 Southern 705 Abandoned
Area due to
(-55 water
degrees)
---------------------------------------------------------------------------
16 Southern 1678 359.5 381 21.5 0.017 6.55 0.572 Extended
Area minerali-
(-50 zation by
degrees) 606.5 618.5 12 0.038 3.66 1.288 200 feet
652 667 15 0.015 4.57 0.510 to depth
732 762 30 0.069 9.15 2.355 and 500
includ- 732 744 12 0.135 3.66 4.617 feet
ing north and
787 818.5 31.5 0.080 9.60 2.751 west of
includ- 792 807 15 0.111 4.57 3.790 previous
ing shallow
includ- 812 818.5 6.5 0.090 1.98 3.085 drilling
ing
887 897 10 0.020 3.05 0.676
1001 1019 18 0.035 5.49 1.204
---------------------------------------------------------------------------
18 Southern 1502 No
Area significant
(-55 gold
degrees)
---------------------------------------------------------------------------
20 Southern 1708 No
Area significant
(-60 gold
degrees)
---------------------------------------------------------------------------
22 Southern 1000 0 15 15 0.053 4.57 1.817 500 feet
Area (-60 southwest
degrees) 300 345 45 0.041 13.72 1.387 of hole
16; enco-
untered
similar
shallow
minerali-
zation;
no signi-
ficant
minerali-
zation at
depth
---------------------------------------------------------------------------
23 Southern 1704 230 241 11 0.072 3.35 2.475 Confirma-
Area tion of
includ- minerali-
ing 230 233 3 0.242 0.91 8.300 zation
(-60 previous-
degrees) 266.5 310 43.5 0.088 13.26 3.018 ly ident-
includ- ified in
ing 266.5 277 10.5 0.168 3.20 5.755 shallow
279.5 287 7.5 0.086 2.29 2.940 drilling;
291 294 3 0.140 0.91 4.810 no signi-
299 310 11 0.091 3.35 3.124 ficant
minerali-
zation at
depth
---------------------------------------------------------------------------
Previously Announced on September 6, 2006
---------------------------------------------------------------------------
7 Southern 1140 210 220 10 0.033 3.05 1.128 New
Area target
(-50 encourte-
degrees) 280 310 30 0.025 9.14 0.867 red disc-
350 365 15 0.052 4.57 1.78 ontinous
495 510 15 0.014 4.57 0.469 minerali-
720 735 15 0.019 4.57 0.653 zation to
a depth
of 560
feet
---------------------------------------------------------------------------
---------------------------------------------------------------------------


---------------------------------------------------------------------------
---------------------------------------------------------------------------
Hole Target Hole Assay Interval Gold Assay Gold Assay Purpose &
No. Area Length From To Length Ounces Length Grams Results
(feet) (feet) feet) (feet) per (meters) per
(Angle) ton tonne
---------------------------------------------------------------------------
MIDDLE AREA
---------------------------------------------------------------------------
10 Middle 300 Abandoned
Area (-55 due to
degrees) water
---------------------------------------------------------------------------
11 Middle 440 370 390 20 0.028 6.10 0.960 Deeper
Area (-55 core
degrees) drilling
pending
---------------------------------------------------------------------------
12 Middle 680 50 75 25 0.020 7.62 0.695 Deeper
Area (-55 core
degrees) drilling
pending
---------------------------------------------------------------------------
15 Middle 2267 No signi-
Area (-50 ficant
degrees) gold
---------------------------------------------------------------------------
19 Middle 2034 459.5 465.0 5.5 0.014 1.68 0.483 New targ-
Area (-50 470.0 487.0 17.0 0.011 5.18 0.378 et and
degrees) encounter-
ed low
grade gold
mineraliz-
ation and
extremely
anomalous
trace
elements
---------------------------------------------------------------------------
24 Middle 227 128 143 15 0.013 4.57 0.450 Abandoned
Area (-70 due
degrees) to poor
ground
conditions
---------------------------------------------------------------------------
ROOSTER AREA
---------------------------------------------------------------------------
3 Rooster 1575 No signi-
(-55 ficant
degrees) gold
---------------------------------------------------------------------------
4 Rooster 1945 545 560 15 0.014 4.57 0.494 Extended
(-60 705 725 20 0.010 6.10 0.344 mineral-
degrees) 740 765 25 0.042 7.62 1.453 ization
includ-
ing 740 755 15 0.063 4.57 2.147 600 feet
to the
northwest
of
Rooster
area
---------------------------------------------------------------------------
13 Rooster 860 130 160 30 0.013 9.15 0.462 Deeper
(-90 core
degrees) drilling
pending
---------------------------------------------------------------------------
14 Rooster 960 230 245 15 0.012 4.57 0.403 Extended
(-60 255 265 10 0.019 3.05 0.660 mineral-
degrees) 295 305 10 0.013 3.05 0.444 ization
315 325 10 0.014 3.05 0.472 100 feet
425 445 20 0.017 6.10 0.579 north of
Rooster
area
---------------------------------------------------------------------------
17 Rooster 2485 No signi-
(-55 ficant
degrees) gold
---------------------------------------------------------------------------
21 North 1662 242 262 20 0.025 6.10 0.845 Extended
Rooster (-70 347 357 10 0.012 3.05 0.412 mineral-
degrees) 362 377 15 0.016 4.57 0.559 ization
409 447 38 0.028 11.52 0.957 560 feet
467 477 10 0.053 3.05 1.818 north of
502 512 10 0.011 3.05 0.369 Rooster
area
---------------------------------------------------------------------------
---------------------------------------------------------------------------


---------------------------------------------------------------------------
---------------------------------------------------------------------------
Hole Target Hole Assay Interval Gold Assay Gold Assay Purpose &
No. Area Length From To Length Ounces Length Grams Results
(feet) (feet) feet) (feet) per (meters) per
(Angle) ton tonne
---------------------------------------------------------------------------
ROOSTER AREA
---------------------------------------------------------------------------
26 North 1340 145 180 35 0.010 10.67 0.351 Extended
Rooster (-45 483 496 13 0.014 3.96 0.476 mineral-
degrees 508 529 21 0.037 6.40 1.270 ization
698 708 10 0.015 3.05 0.504 240 feet
to the
west of
Hole 21
---------------------------------------------------------------------------
30 North 865 0 145 145 0.039 44.21 1.319 Confirm
Rooster (-50 Rooster
degees) mineral-
ized and
includ- test
ing 95 145 50 0.081 15.24 2.786 struc-
includ- tural
ing 115 125 10 0.180 3.05 6.170 controls
160 170 10 0.012 3.05 0.415
250 260 10 0.020 3.05 0.681
305 380 75 0.037 22.87 1.258
includ-
ing 310 375 65 0.040 19.82 1.362
480 495 15 0.056 4.57 1.910
---------------------------------------------------------------------------
Previously Announced on September 6, 2006
---------------------------------------------------------------------------
1 North 644 110 130 20 0.014 6.10 0.485 Confirmed
Rooster (-90 200 230 30 0.057 9.14 1.955 known
degrees 240 405 165 0.044 50.29 1.502 mineral-
ization
includ- and
ing 345 385 40 0.113 12.19 3.853 extended
445 470 25 0.041 7.62 1.403 70 feet
to depth
---------------------------------------------------------------------------
1B North 640 15 25 10 0.014 3.05 0.476 Extended
Rooster (-90 260 320 60 0.019 18.29 0.646 mineral-
degrees) 340 380 40 0.047 12.19 1.594 ization
475 490 15 0.019 4.57 0.624 175 feet
505 520 15 0.016 4.57 0.563 to depth
560 575 15 0.050 4.57 1.724
---------------------------------------------------------------------------
2 North 1030 135 145 10 0.013 3.05 0.424 Inter-
Rooster (-55 sected
degrees) two new
mineralized
features
more than
1000 feet
east of
Hole 1
---------------------------------------------------------------------------
5 North 1295 470 490 20 0.021 6.10 0.721 Northwest
Rooster (-50 525 540 15 0.024 4.57 0.823 of Hole 1
degrees) 600 720 120 0.028 36.58 0.946 approx-
775 790 15 0.032 4.57 1.095 imately
200 feet
---------------------------------------------------------------------------
6 North 500 145 155 10 0.014 3.05 0.459 Southwest
Rooster (-70 220 245 25 0.018 7.62 0.617 of Hole 1
degrees) 320 330 10 0.015 3.05 0.519 approx-
400 415 15 0.016 4.57 0.541 imately
264 feet
---------------------------------------------------------------------------
---------------------------------------------------------------------------


A map detailing the Tonkin drill hole locations has been uploaded to the CCNMatthews website, to view the map please visit the following link: http://www.ccnmatthews.com/docs/UXGDRILLMAP1221.jpg

Contact Information

  • U.S. Gold Corporation
    William F. Pass
    Vice President and Chief Financial Officer
    (303) 238-1438
    (303) 238-1724 (FAX)
    Email: bill@usgold.com
    or
    U.S. Gold Corporation
    Ian Ball
    Investor Relations
    (647) 258-0395 or Toll Free: 1-866-441-0690
    (647) 258-0408 (FAX)
    Email: info@usgold.com