January 25, 2011 (Investorideas.com Mining stocks newswire) If you believe in the adage ‘mines are made, not discovered’ then the time has come to turn your attention to Kootenay Gold Inc. TSX.V KTN.
Drawing from the experience of its management team, led by Company CEO and Chief Geologist James McDonald, Kootenay is applying the same pragmatic approach to its flagship Promontorio Silver Project in Sonora Mexico, that has helped companies McDonald has been associated with, such as Alamos Gold Inc., turn into accomplished producers.
Since first acquiring the historic past producer in 2005, Kootenay has taken no shortcuts in its quest to systematically exploit the vast silver resources believed to exist within Promontorio’s 79,000 hectare borders. Based on its success to date and the projects maturing status, the Company’s comprehensive approach appears to be paying off.
To summarize, detailed work conducted to date on Promontorio has included extensive ground exploration, till sampling, airborne geophysical, 3-D IP Survey, 3-D modeling along with 3-D geophysics and over 28,000 meters of drilling. Characterized by excellent grades and widespread silver mineralization, the highly focused, multi-phase strategy has been met with success at virtually every turn. Highlights from 49 drill holes in Promontorio’s Pit Discovery included 18.4 meters grading 950 g/t and 151 meters grading 162 g/t silver-equivalent.
Not surprisingly, Promontorio’s growing silver resource and its potential to develop into a substantial mining entity has not been lost on the investment community. A recently completed $6 million non-brokered financing, led by Sprott Asset Management and a consortium of institutional investors, has boosted the Company’s cash reserves to a healthy $11 million and paved the way to further fast track development on the project over the coming months. Going forward, the current multi-phase drilling program now underway on Promontorio is expected to play a vital role in establishing grades and continuity and the overall size and tonnage of the silver resource.
A 43-101 Resource Estimate released late last year shows the property contains indicated and inferred resources of over 10 million ounces of silver along with substantial amounts of lead and zinc. The overall contained metal values at Promontorio are now estimated at over $320 million. These are exciting developments considering many pundits believe the resource doesn’t have to get substantially larger before it starts looking like a mine.
Clearly, Kootenay has carried the momentum into its current 10,000 meter drill program now underway on Promontorio. Results from the first four drill holes have already extended silver mineralization 100 meters outside the current 43-101 Pit Discovery Zone with mineralization remaining open to the West, North, East and to depth.
Based on results to date, combined with management’s acute understanding of the Project’s geological control within large areas of widespread silver mineralization, Kootenay CEO James McDonald remains confident Promontorio contains a silver resource commensurate with other notable producers within Mexico’s Sierra Madre region.
“We have said all along the proof will be in the drill bit, and thus far it has yet to let us down. Based on supporting scientific data and the advancements we are seeing now, we have every reason to believe we have a viable shot to double or triple our current resource, or more, through the current program.” James McDonald, Kootenay Gold CEO
Granted results are going to be the determining factor, but there is no doubt the Company has good reason for its optimism. Doubling or tripling its current silver resource at Promontorio could drive the total contained metal values on the project to over $1 billion. In short, if objectives are met, Promontorio could well be a ‘Company Maker’.
At present, Kootenay is looking forward to receiving results from a series of recently completed drill holes that have been sent in for assaying from the current 10,000 meter program. To further accelerate its aggressive development on Promontorio, the Company says it expects to add a second drill rig to the program in the near future.
It should be very interesting to follow Kootenay’s developments on Promontorio over the coming weeks and months.
Is Kootenay Gold and its Promontorio Silver Project on your radar screen?
If not, maybe it should be.
Richard (Rick) Mills
[email protected]
www.aheadoftheherd.com
