Copperstone Air Photo showing Target Zones & Development
November 19, 2007 American Bonanza Corporate Update
November 19, 2007 - American Bonanza Gold Corp. (TSX: BZA, Frankfurt: AB2, USPK: ABGFF) ("Bonanza") reports significant 2007 developments at several projects following its triple objective strategy to increase shareholder value.
- Objective 1: Achieve production -- Two major gold discoveries have been made at the high grade Copperstone project, where mine planning studies will likely further improve due to the addition of high grade mineralization to the resource base. More drilling is planned soon to follow-up these exciting new gold zones. The recently signed agreement with Agnico-Eagle to jointly develop the Northway and Vezza properties represents a second high priority project with near term production potential. Drilling is planned for late 2007 to expand the high grade portions of the Northway project.
- Objective 2: Discovery through exploration -- Successful results at the Fenelon Nickel project, the La Martienere gold project and the Northshore gold project. These projects hold significant potential and are showing excellent results. Additional drilling is planned at these three projects, and the first resource estimate for La Martienere will begin to quantify the 1.3 kilometer long gold zone at the project.
- Objective 3: Market assets where benefits to the Company's treasury will ameliorate the need for future dilution. The Taurus project was sold on excellent terms: up to $11 million plus 3 million shares of Cusac Gold Mines. The Northway Joint Venture also limits exploration expenditures. Several other projects are being considered for Joint Venture or marketing to new partner companies.
Through 2007, Bonanza has continued to aggressively develop its exciting projects in the mission to become a high grade gold producer based in stable areas of Canada and the United States. So far in 2007, Bonanza has drilled a total of over 22,000 meters in pursuit of its strategy to develop mines while discovering new deposits.
In August 2006, Bonanza began an aggressive drilling campaign following calculation of high grade gold resources at the 100% owned Copperstone gold project in Arizona. The drilling was designed to expand the March 2006 gold resource of 970,700 tonnes grading 10.7 grams per tonne gold (Measured and Indicated, another 66,000 ounces of gold are contained at similar grade in the Inferred category), as previously announced. In a little over one year, two phases of drilling were completed, consisting of 44 drill holes with a combined length of 13,177 meters (43,227 feet). Ten targets were drilled, all within 1,200 meters of the current resource and mine infrastructure. Several targets returned encouraging results, and two substantial new gold zones were discovered.
The South Pit Target was first identified by Phase I drill hole 06CS-12 which encountered strong gold mineralization and favorable alteration and structure, so the decision was taken to continue drilling in Phase II. The South Pit target is at the south end of the open pit from which over one half million ounces of gold were produced between 1987 and 1993, and is south of the current high grade gold resource. The South Pit target is now identified by six drill holes drilled along a north-south line, all with significant gold intercepts, has a known strike length of 500 meters, and is open along its entire length to the east and west. The drill results are:
- 3.0 meters grading 39.4 grams per tonne gold in drill hole 07CS-36
- includes 1.5 meters grading 69.3 grams per tonne gold
- 2.1 meters grading 14.1 grams per tonne gold also in drill hole 07CS-36
- includes 1.0 meters grading 28.5 grams per tonne gold
- 4.6 meters grading 4.9 grams per tonne gold in drill hole 07CS-37
- includes 1.5 meters grading 11.2 grams per tonne gold
- 7.6 meters grading 10.6 grams per tonne gold in drill hole 07CS-34
- includes 3.0 meters grading 18.9 grams per tonne gold
- 2.4 meters grading 6.8 grams per tonne gold in drill hole 07CS-32
- and 2.7 meters grading 5.5 grams per tonne gold
- 4.6 meters grading 4.8 grams per tonne gold in drill hole 06CS-12
- includes 3.0 meters grading 6.6 grams per tonne gold
These results were announced in Company news releases dated October 11, 2007, September 27, 2007 and November 23, 2006. Follow up drilling to expand the zone to the east and west is currently being planned.
The Southwest Target is located approximately 1,000 meters southwest of the open pit, and is currently identified by three drill holes with high grade gold intercepts. Drill hole 07CS-30 is located approximately 20 meters west of drill hole 06CS-22, and drill hole 07CS-31 is located about 50 meters south of hole 07CS-30. The new gold zone strikes approximately 20 degrees west of north (near parallel to the Copperstone Fault) and has an intermediate dip to the northeast (same direction as the Copperstone Fault). The zone remains open in all directions, and may represent the discovery of a new gold bearing structure similar to the Copperstone Fault which hosts the high grade gold resources. The results are:
- 5.2 meters grading 18.3 grams per tonne gold in drill hole 07CS-30
- includes 1.5 meters grading 58.8 grams per tonne gold
- 4.6 meters grading 12.3 grams per tonne gold in drill hole 07CS-31
- includes 3.2 meters grading 16.1 grams per tonne gold
- 1.5 meters grading 25.8 grams per tonne gold in drill hole 06CS-22
- within 13.7 meters grading 3.91 grams per tonne gold
These results were announced in Company news releases dated September 10, 2007 and February 5, 2006. Follow up drilling to expand the zone to the east and west is currently being planned. The development of additional resources would positively impact Bonanza's ongoing studies to place Copperstone into production. Other high priority targets drilled during 2006 and 2007 also returned exciting results and will be further drilled.
The Company's Management and Directors have determined that the recently discovered potential for dramatically expanding the high grade gold resources should be quantified and incorporated into the current study into the economics of placing the current Copperstone resource into production. These new gold zones have the potential to significantly expand the mine plan and improve the economic returns. The current study by the Company is optimizing the mining and milling plan, along with capital and operational costs, and has been expanded to include collection of "turnkey" bids for mill construction. Certain aspects of the study, including capital and operating cost sensitivities continue on a limited basis, although most aspects will be delayed until the new gold discoveries and their impact on mine planning can be quantified.
During 2007, Bonanza increased its interest in the Northway property from 75% to 100%, as previously announced. Northway is located 25 kilometers south of Matagami, Quebec. The Northway property lies one kilometer along strike to the east of Agnico Eagle's Vezza deposit and may be a continuation of the same gold zone. Northway contains a historic resource of 18.2 million tones grading 1.48 grams per tonne gold, containing 866,000 ounces of gold, as previously announced. Within this resource, significant higher grade zones are present. The resource remains open along strike and down dip in several areas.
American Bonanza has entered into a letter of intent ("LOI") with Agnico-Eagle Mines Limited for the joint exploration and development of Bonanza's Northway Property and Agnico-Eagle's 375,000 ounce Vezza Property, as previously announced.
Significant gold resources are present at both the Northway Property and the adjacent Vezza Property, where a shaft has been constructed. It is believed that the combined properties offer greater potential for mine development than they do separately. The LOI provides that Bonanza will grant Agnico-Eagle the option to acquire a 70% interest in the Northway-Noyon Property. To exercise the option, Agnico-Eagle must expend $1,699,500 in exploration expenditures on the Northway Noyon property over a three year period and must assign a 30% interest in the Vezza Property to Bonanza. After exercise of the option, the combined Northway-Noyon and Vezza properties will be operated on a joint venture basis with Bonanza initially holding a 30% interest in the joint venture. Agnico-Eagle will be the operator.
Bonanza's Phase I and Phase II drill results outline a continuous 1.3 kilometer long zone of high grade gold mineralization at the 100% owned La Martiniere property in Quebec (see Bonanza news release dated September 20, 2006). The property is located between Fenelon and the multi-million ounce Detour Lake Gold Mine.
Bonanza's drilling to date consists of 22 drill holes with a combined length of 4,763 meters, effectively doubling the drilling that has ever been completed on the project. Bonanza's drilling successfully expanded the known mineralized zones, demonstrates the continuity of gold mineralization, and indicates the substantial size potential of this mineralized system.
The gold mineralization is open along strike and down dip, with most drilling encountering the gold bearing structures within 100 meters from surface. Preliminary resource estimations are planned in advance of preparation of the next phase of drilling, which will be designed to explore to further expand the known gold mineralization. Previously announced highlights from Bonanza's drilling include:
- 1.0 meter grading 44.3 grams per tonne gold in drill hole MD-07-20
- within a 28.4 meters grading 2.3 grams per tonne gold.
- 3.0 meters grading 7.2 grams of gold per tonne in drill hole MD-07-12
- within 4.8 meters grading 5.1 grams per tonne gold
- 1.1 meters grading 13.5 grams of gold per tonne in drill hole MD-06-05
- within a 7.1 meters grading 3.8 grams of gold per tonne
- 1.0 meters grading 10.9 grams of gold per tonne in drill hole MD-07-13
- within a 2.0 meters grading 6.5 grams per tonne gold
- 5 meters grading 5.1 grams per tonne gold in drill hole MD-07-14
- and 4.4 meters grading 4.4 grams per tonne gold.
- 1.6 meter zone grading 18.45 grams per tonne gold in drill hole MD-06-09
- including 0.8 meters grading 31.6 grams per tonne gold.
- 11.0 grams per tonne gold over 0.7 meters in drill hole MD-06-07
- 4.1 meters grading 6.2 grams per tonne of gold in drill hole MD-06-08
- including 2.1 meters grading 11.2 grams per tonne of gold
- and 1.0 meters grading 18.7 grams per tonne of gold
The best intercepts from historic drilling programs include:
- 14.4 grams per tonne of gold over 4.2 meters
- 17.5 grams of gold per tonne over 1.5 meters
- 9.3 grams per tonne of gold over 0.7 meters
- 9.2 grams per tonne gold over 1.0 meters, and
- 5.9 grams per tonne of gold over 6.5 meters, as previously announced.
American Bonanza holds 100% ownership of the Fenelon property, which is comprised of 454 mining claims covering approximately 7,511 hectares in the Casa Berardi region of northern Quebec, 65 kilometers east of the Detour Lake Mine and 200 kilometers north of Rouyn-Noranda.
Bonanza's recent drill program at the Fenelon Project has identified two nickel rich zones with grades up to 1.9% nickel. Every hole drilled in the zones encountering strong nickel mineralization in massive sulfide horizons. The southern target is 1.3 kilometers long and the northern target is 800 meters long. Both targets strike along a northwest trend, and lie approximately one kilometer apart. The southern target is identified by five drill holes and the northern target is identified by four drill holes. All drilling has focused on the strike extent of the nickel mineralization at depths between 100 meters and 300 meters from surface. Drilling up dip and down dip is currently being planned, and the targets remain open everywhere in these directions.
Drilling highlights include, all previously announced:
- 14.0 meters grading 0.43 % nickel in drill hole FA-07-306
- includes 0.5 meters grading 1.7% nickel
- and 0.5 meters grading 1.6% nickel
- and 0.5 meters grading 1.6% nickel
- 15.2 meters grading 0.31 % nickel in drill hole FA-06-285
- includes 0.5 meters grading 1.4% nickel
- 14.2 meters grading 0.24 % nickel in drill hole FA-07-305
- includes 0.5 meters grading 1.4% nickel
Further drilling is planned to follow up these successful results. Bonanza and previous workers have drilled a small high grade gold resource at Fenelon, located approximately 4 kilometers southwest of the nickel discovery zone. Bonanza has drilled a total of 46 holes with a combined length of over 14,000 meters. The gold drilling successfully demonstrated continuity of mineralization, although significant expansion of the resource has thus far proven difficult. The drilling was successful in identifying new parallel gold zones which are being studied to plan further drilling in a continuing effort to expand the resource.
Highlights from Bonanza's drill campaign include drill hole FA-06-297 which intersected an 11.5 meter zone grading 15.7 grams per tonne gold (see Bonanza news release dated July 19, 2006). Drill hole FA-270 identified a new parallel gold zone about 500 meters west of the Discovery Zone (see Bonanza news release dated March 1, 2006) in what has been termed the West Discovery Zone. The drill hole encountered a 1 meter zone grading 14.5 grams per tonne gold within a three meter zone grading 6.2 grams per tonne gold
Bonanza has completed one phase of drilling at the 100% owned Northshore property in Ontario, consisting of 11 drill holes with a combined length of 3,145 meters. Phase I drilling confirmed the high grade nature of the target, and extended known gold mineralization in several directions. The gold zones remain open to expansion, and Phase II drilling is scheduled for the winter of 2007.
Northshore is an exploration project discovered in the 1990's that is located 70 kilometers west of the Hemlo Gold deposit in Ontario on the same structural break. The property hosts strong gold mineralization and was drilled by Noranda Inc. and Cyprus Minerals. A total of 3,600 meters of drilling in 27 drill holes has been completed by previous workers. This drilling has identified at least 4 parallel gold zones containing significant high grade zones of gold mineralization within a lower grade envelope.
Highlights from Phase I drilling include drill hole NS-06-03 which targeted an area 300 meters north of historic drilling where several quartz veins have been mapped and with surface samples over 34 grams per tonne gold. This hole intersected 1.2 meters grading 43.5 grams per tonne gold, and a separate zone of 1.0 meters grading 19.2 grams per tonne gold. (Please see Bonanza news release dated December 13, 2006). Follow up drilling will explore along strike and down dip. The zone is open in all directions.
Highlights also include drill hole NS-06-08, which intercepted 10.3 grams per tonne gold over 1.0 meters. This interval and additional lower grade zones, lie 200 meters below and down dip from previously known gold mineralization, representing excellent depth potential for expanding the gold zones.
Bonanza is currently reviewing several other properties it controls, with a view towards unlocking the value of these high potential properties for its shareholders. In 2007, American Bonanza signed a definitive Agreement with Cusac Gold Mines Ltd. for the sale of its large low grade Taurus Project for consideration valued up to Cdn.$11 million plus three million common shares of Cusac Gold Mines in staged payments over 2 years, as previously announced. Several other properties warrant exploration and development programs, and are being reviewed with the objective of determining the best plan for realizing the value within.
Bonanza is a gold company engaged in the acquisition, exploration and development of high-grade gold properties located in the United States and Canada. Bonanza is advancing both its Development stage Copperstone gold project in Arizona and the Northway gold project in Quebec. Bonanza is well financed with no long-term debt. For additional information about Bonanza and project maps please visit our website at www.americanbonanza.com
This Press Release has been prepared and revised under the supervision of Jose Portacio a Qualified Person as defined by National Instrument 43-101 guidelines
AMERICAN BONANZA GOLD CORP.
(signed) Brian Kirwin
President & Chief Executive Officer
CAUTIONARY NOTE TO U.S. INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES
This news release uses the terms. "Measured and Indicated Resources". Bonanza advises US investors that while those terms are recognized and required by Canadian regulators, the U.S. Securities and Exchange Commission does not recognize them .U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.. This news release also uses the term "Inferred Resources". Bonanza advises US investors that while this term is recognized and required by Canadian regulators, the U.S. Securities and Exchange Commission does not recognize it. "Inferred Resources" have a great deal of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. U.S. investors are cautioned not to assume that part or all of an Inferred Resource exists, or is economically or legally mineable.
This news release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, including the likelihood of commercial mining and possible future financings are forward-looking statements. Although Bonanza believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include unsuccessful exploration results, changes in the price of gold, changes in the availability of funding for mineral exploration and/or development, unanticipated changes in key management personnel and general economic conditions. Mining exploration and development is an inherently risky business. Accordingly the actual events may differ materially from those projected in the forward-looking statements. For more information on Bonanza and the risks and challenges of its business, investors should review Bonanza's annual filing on Form 20-F with the U. S. Securities Commission and its home jurisdiction filings that are available at www.sedar.com.
For further information call:
Longview Strategies Incorporated
Attention: Eugene Toffolo
Susan L. Wilson, Corporate Communications
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