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Drilling for gold in fire season
TerraX resource estimate expected before end of year

Walter Strong
Northern News Services
Published Wednesday, July 23, 2014

SOMBA K'E/YELLOWKNIFE
By the time this summer is complete, TerraX Minerals Ltd. will have added up to 5,000 metres of drilling to the approximately 10,000 metres of historical data the company inherited when it took possession of what is now known as the Yellowknife City Gold project.

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Northtech Drilling Ltd.'s Jonathan Paquin releases drill cores collected on the Barney Shear zone of TerraX Minerals Ltd.'s Yellowknife City Gold project north of the city. - Walter Strong/NNSL photo

But that's assuming this season's record-breaking forest fires don't interfere with drilling schedules, as they did last weekend.

A fire was sparked on Saturday near a drilling site about four kilometres northeast of Vee Lake, in the Barney Shear, which forced the evacuation of a Northtech Drilling Ltd. rig crew.

"The fire began to the north of us with a south wind," said TerraX president Joe Campbell.

"We had to evacuate our crews. Fortunately, we had a helicopter in the area."

Campbell described the fire, origins unknown, as making it to within 15 metres of drilling equipment, before being extinguished by water bombers.

"Everything worked out alright for us," Campbell said. "We got our crews out and there was no significant damage to any of the equipment."

Campbell and investors in TerraX are hoping that a summer fire isn't going to be the last excitement to surround the Yellowknife City Gold project.

The property comprises more than 8,400 hectares north of Yellowknife, stretching approximately 16 km northward from the Vee Lake area.

The property, TerraX documentation shows, encompasses an extension of the geology that contained the former Giant and Con gold mines.

Campbell, a registered professional geologist and part of the development team that brought Agnico-Eagle's producing Nunavut Meadowbank gold mine to feasibility, is confident viable gold remains to be found.

Before this year is out, TerraX will have spent approximately $2 million on drilling, prospecting, assaying, aerial surveys, and baseline environmental studies. The program is largely designed to shore up reams of historical data and produce at least one, but maybe two, national standard compliant NI 43-101 resource estimates.

"We're hoping that even though this is a very modest drill program, we'll be in a position to do at least one 43-101 by the end of this year," Campbell said.

This is thanks largely to existing data TerraX inherited when it purchased the properties making up Yellowknife City Gold early in 2013.

Most of this summer's drilling is focused on the Barney Shear and Crestaurum zone on the southern end of the property.

The Crestaurum, approximately four kilometres northwest of Vee Lake, has the most historical data associated with it thanks to a former gold mine project dating back to 1938 when the claim was first staked.

Drilling programs in 1965 and 1985 went so far as to include dropping in a mine shaft, but the project was abandoned. More than 180 drill holes were completed.

Because there's so much existing data associated with Crestaurum, Campbell hopes this season's drilling will shore up and verify previous work, giving a modern NI 43-101 compliant resource estimate.

"There's potential that a large part of the Crestaurum would be a drill indicated (resource) because of the holes that have already been put on it," Campbell said.

"Another property we hope to be able to put a small (open-ended) resource on is the Barney (Shear)," Campbell added.

The Barney shear is a potentially larger, but less explored deposit approximately two kilometres northeast of the Crestaurum site.

As recently as 1996, the Barney shear was drilled by Nebex Resources Ltd. including a 674-metre hole that, according to Terrax documentation, showed favourable results for gold, silver and other metals when re-sampled and assayed last year. But Campbell doesn't expect this season's drilling to produce more than a limited NI 43-101 compliant-inferred resource estimate, if any estimate at all.

"This (drill) program is simply correlating previous drill holes," Campbell said.

"We're (also) doing a bit of infill drilling in around some of the previous holes to try and discover continuity in the zones."

Shoring up existing data means TerraX can potentially arrive at a modern resource estimate on a relatively modest budget of $2 million and within a one year window.

"This gives us an opportunity to be well ahead of the game," Campbell said. "We're considering a very modest drill program and we're already talking about a first resource estimate."

Campbell said TerraX is well-funded to complete this year's work, and he expects the company go into the new year on a positive cash note.

TerraX will be hosting information sessions this fall to talk about results and to give property owners in the area the opportunity to hear what the company's future plans are.

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