2018 Year in Review
|Dear Shareholders, January 24, 2019
With 2019 well underway and the start of the conference season to market our Company, it is a good time to reflect back upon the successes for 2018 and to update you on Banyan’s strategy and the path forward for 2019.
2018 was a busy and successful year for Banyan Gold, as we continued to focus on exploring projects that meet our selection criteria:
· Favorable geology in proven mineral districts
· Multi-million ounce potential
· Road access and other infrastructure
· Favorable jurisdiction that allow for mines to be put in production
These are the criteria required for exploration projects to advance to be mineable deposits. Our current projects fit these criteria and we are achieving our goals at both our Hyland Gold Project and Aur-Mac Project, on modest budgets.
Moreover, the Yukon is benefitting tremendously with Victoria Gold Corp. fully financed (see Victoria News Release of March 8, 2018) Eagle Gold Mine now under construction (see Victoria News Release of September 19, 2018). Eagle is our neighbor to the north from the Aur-Mac Project just outside the community of Mayo.
Highlights for both our projects and the Company are summarized below.
Hyland Gold Project
The 2018 work bolstered the Company’s belief that the Hyland Gold Project, located 70km from Watson Lake, benefits from a gravel road access and an extensive road network on the property. The large land package has the potential to host multi-million gold ounces in heap-leach amenable open pit scenarios.
2018 again saw advancement of the Hyland Gold Project. After a 3,850 drill program, LIDAR, detailed drill hole and trench surveys in 2017, Banyan undertook to improve the understanding of Metallurgy and the Resource at the Hyland Gold Project. Metallurgy was examined with bottle rolls averaging 83.3% (News Release dated, January 8, 2018) and importantly the first ever, column leach tests from the property, from 3 dedicated holes returned impressive results averaging 86% Au recovery from the oxide (News Release March 13, 2018).
In March of 2018, Banyan released an updated Hyland Main Zone Resource (News Release, March 22, 2018), with increased indicated and inferred gold ounces, and importantly increasing the quality and confidence in the Main Zone resource as a deposit amenable to open pit, heap leach mining methods.
The Hyland Main Zone Indicated Gold Resource Estimate, prepared in accordance with NI 43-101, at a 0.3 g/t gold equivalent cut-off, contains 8.6 million tonnes grading 0.85 g/t AuEq for 236,000 AuEq ounceswith an Inferred Mineral Resource of 10.8 million tonnes grading 0.83 g/t AuEq for 288,000 AuEq ounces.
(1) Mineral resources which are not mineral reserves do not have demonstrated economic viability. All figures are rounded to reflect the relative accuracy of the estimate.
(2) Mineral resources are reported at a cut-off grade of 0.3 g/t AuEq. AuEq grade is based on $1,350.00/oz Au, $17.00/oz Ag and assumes a 100% recovery. The AuEq calculation does not apply any adjustment factors for difference in metallurgical recoveries of gold and silver. This information can only be derived from definitive metallurgical testing which has yet to be completed.
*News Release March 22, 2018 and Technical Report filed May 2, 2018.
Considering the impressive leaching kinetics (average oxide column leach recoveries of 86%), the geometry and proximity to the surface of the resource (within 200m of surface) and the similar technical parameters of other current and successful heap leach projects in northern North America, the conceptual mining method for the Hyland Main Zone would be open pit, heap leach. Northern heap leach comparables include: Victoria Gold’s Eagle deposit (Cut-off grade of 0.15 g/t Au – News Release December 5, 2018), Kinross’ Fort Knox Mine (Cut-off at detection, average head grade of 0.37 g/t Au – News Release June 12, 2018) and Goldcorp’s (formerly Kaminak) Coffee Deposit (Cut-off grade of 0.3 g/t Au for oxide and transition zone).
The work to update the Main Zone Gold Resource opened up potential mineralization continuity at the Main Zone on all sides and to depth. With the resource projecting to a small surface area of 900m by 600m, on the 186km2 land package and with 3 additional target areas with known gold mineralization (Camp Zone, Cuz and Montrose Ridge) along 9.5 km of the 18 km of structural trend on the property, there is considerable opportunity resource expansion. There are also numerous untested Au/As anomalies on the property, representing high-priority targets for future exploration.
The 2018 exploration program at Hyland was focused on the establishment of mineralization continuity between the current NI 43-101 resource* and the Camp Zone to the North. To this end, eight (8) trenches totaling 1,184 metres and eleven (11) diamond drill holes totaling 1,294 metres were completed to establish gold-silver mineralization continuity along the projected shallow dipping upper limb of the Main Zone over the target 1.25km of previously limited tested strike length between the Main and Camp Zones. These collective exploration initiatives combined to successfully extend gold mineralization signatures between the Main and Camp Zones and emphasized the importance of brittle deformation to tenor and extent of gold mineralization.
2018 Drill Highlights
The program resulted in the highest gold grade drill hole intersection discovered to date from the Property (14.5 g/t over 1.52 m in oxide, from an area only 50 metres from the limit of the 2017 Main Zone Resource), and the results demonstrate the Quartz Lake Corridor is consistently mineralized and validate the near surface strike extent model the program was designed to test.
Highlighted results from, HY18-076 to HY18-077, both located approximately 50 metres from the northern limit of the current Hyland Main Zone Resource include:
2018 Trench Highlights
Of particular note were trenches TR-18-03 and TR-18-08, which together have added over 150 metres of Hyland Main Zone tenor surface gold mineralization immediately north of the current NI 43-101 resource* at the Main Zone. Highlighted results from these two trenches include:
These trenches are punctuated by multiple two-metre channel samples ranging in grade from 1.0 g/t to 4.0 g/t, and it was noted from trench mapping and sampling that this higher-grade gold mineralization increases with the intensity and widths of fault breccias and gouge zones. This gold-silver mineralization association has been noted within Main Zone and furthermore exhibit a similar ~1:4 Au:Ag ratio; indicating persistent Main Zone style mineralization towards the Camp Zone.
In addition, in 2018, the company was able to mobilize a second camp into the property in preparation for future larger exploration programs and to reduce exploration costs to access areas of the property that are inefficient to explore from the current camp.
In 2017, Banyan optioned the Aurex and McQuesten properties in central Yukon, from Victoria Gold Corp. and Alexco Resource Corp., respectively. These two properties had known surface gold mineralization and located right where two highly mineralized belts converge: Alexco Resource Corp’s high grade silver deposits and Victoria Gold’s Eagle Deposit, the latter currently being constructed and scheduled to produce over 200,000 ounces of gold annually starting in second half of this year.
The old adage of “the best place to find a new mine is in the shadow of the headframe of another mine” is more than applicable to this project.
The McQuesten Zone has existing infrastructure and is located just 100m west of the main Yukon Government highway between Mayo and Keno and just 50m north of the all-season road to Victoria Gold’s Eagle Deposit. This access combined with adjacent existing power lines, and the Victoria Gold heap leach mine being constructed in close proximity, gives this property significant advantages to host a minable gold deposit. The average grade of the mineral reserve at the Eagle Deposit is 0.67 g/t Au. The recent expansion of the Victoria Gold’s Resource at the Eagle Deposit by 450,000 ounces or 12.5% and a 2.5% increase in grade (Victoria Gold News Release December 5, 2018), to over a 4.0M ounce Resource in the Measured and Indicated category and their continued exploration success on their +13km Potato Hills trend (Victoria Gold News Release January 17, 2019), continues to validate that this is truly an underexplored and highly mineralized area of the Yukon. On January 18th, 2019, Victoria Gold announced a new discovery in a previously undrilled area of their property, just 15 km north of Aur-Mac., the Nugget zone, where they trenched 124m of 3.25g/t Au including 58 m of 4.68g/t Au).
In the McQuesten Zone, Banyan developed a geological model, a 900m block of calcareous clastic sediments approximately 90m thick dipping about 30 degrees to the south that is interpreted to host gold mineralization within stratabound retrograde skarn-altered horizons. With 2018’s approximately 1,414m of diamond drilling, a volume of about 12 million cubic metres (500m of strike) of this interpreted mineralized block “Block 1” was tested with nominal drill-section spacing of 100m and nominal in section drill spacing of 50 metres. Broad zones of gold mineralization intersected with Banyan’s 2017 and 2018 drilling campaigns have averaged 0.51 g/t Au confirmed the geologic model for the McQuesten Gold Zone contains near surface gold mineralization of this tenor over predictable widths. Banyan’s interpretations and 2018 drill results confirmed potential extensions to the east, west and down-dip to the south, all of which remain open to further delineation.
McQuesten Gold Zone “Block 1” intercepts from Banyan’s 2017 and 2018 drilling campaigns are summarized below:
*True widths are estimated to be >90% of drilled interval lengths
In addition to the modelled calcareous unit containing gold mineralization, an additional structurally controlled target for gold, silver and base metal mineralization, stratigraphically above the McQuesten zone was identified with steeply dipping quartz veins and breccias appearing to be the host of the gold, silver and base metal mineralization. Determination of the orientation, width and location of where these mineralized structures crosscut the stratabound McQuesten gold zone will be an additional target in future drill programs.
The Aurex-McQuesten property is a large property (92.5km2), and the majority of the work by the Company to date has focused in an area of only 0.3 km2 at the McQuesten Zone. Property wide soil sampling programs have identified several additional soil anomaly targets, including the 10.2 km2 As/Au Aurex Hill soil anomaly.
In December 2018, the Company completed the second year earn-in commitments on the properties in both exploration expenditures and share issuance. With the 2018 exploration expenditures the Company has already completed over half of the required work for the year 3 exploration expenditures.
The properties also have a Class IV mining land use permit that is valid for an additional 9 years.
The technical information in this news release has been reviewed and approved by Paul D. Gray, PGeo, a qualified person as defined by National Instrument 43-101.
The company hired James Thom as senior geologist and exploration manager to execute field programs.
The Company received a $40,000 Yukon Government Exploration grant that we used for the Aurex-McQuesten Project. Additionally, in July 2018, the Company completed a financing of just over $930,000.
We will be out talking to shareholders and marketing at the following events:
January 30-31: Core Shack at AMEBC Roundup – Booth 919
February 8 – 10: Whistler Capital Conference
February 24 – 28: Florida Marketing
March 5 – 6: PDAC Investor Forum, booth 2416
September 10 – 13: Beaver Creek Precious Metals Summit
Strategy for 2019
Our expectation is that with improved market conditions, we will be able to move our projects forward in an efficient and timely manner, thus adding shareholder value.
For 2019 on Hyland, plans include the development of drill targets at the Cuz Zone through trenches and structural analysis.
On Aur-Mac, the mineralization model at McQuesten will be tested by an additional 500m of strike (to over 1 km of strike length) and to drill an area on the south of property where higher grade historic drill result indicate there may be an area with increased gold grades.
Your Company continues to examine opportunities to add shareholder value and is well positioned for larger exploration to advance both projects.
We thank you for your continued support.
ON BEHALF OF BANYAN GOLD CORPORATION
(signed) “Tara Christie”
President & CEO
For more information, please contact:
Tara Christie David Rutt
Tel: (888) 629-0444 Tel: (888) 629-0444
CAUTIONARY STATEMENT: The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This news release contains forward-looking information, which is not comprised of historical facts. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, Banyan’s objectives, goals or future plans, statements regarding exploration expectations, exploration or development plans and the timing of negotiating the definitive agreements. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, uncertainties inherent to preparing a resource estimate within expected timeline, capital and operating costs varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry, enhanced risks inherent to conducting business in any jurisdiction, and those risks set out in Banyan’s public documents filed on SEDAR. Although Banyan believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Banyan disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law. Paul D. Gray of Banyan Gold Corp. is a “qualified person” within the meaning of such term as set forth in National Instrument 43-101 of the Canadian Securities Administrators, and has verified and supervised the preparation of all of the scientific and technical information contained in this news release.
Statements in this news release regarding Banyan Gold which are not historical facts are “forward-looking statements” that involve risks and uncertainties. Such information can generally be identified by the use of forwarding-looking wording such as “may”, “will”, “expect”, “estimate”, “anticipate”, “intend”, “believe” and “continue” or the negative thereof or similar variations.