Unless you are a subscriber to Robert Bishop’s Gold Mining Stock Report, you could not have listened to about this budding uranium growth company. The firm’s share price had a healthier rally immediately after the San Francisco Gold Demonstrate, final November, when Kilgore Minerals (TSX: KAU) was talked about as a prospective takeover candidate. Shares in this minimal-known minerals business catapulted from the C$.50 – .60 range to as large as C$1.13/share by February 6th. Pinetree Money (TSE: PNP), alone a red-hot stock whose shares have quadrupled since early November, introduced it had procured about 10.5 p.c of Kilgore Minerals (and if the convertible securities ended up exercised, its ownership could achieve 12.9 %).
What is the excitement above Kilgore Minerals? Norman Burmeister is rarely the promotional type. Even his fantastic good friend, letter writer Robert Bishop, describes the organization as non-marketing. Throughout our interview, it transpired a person could think of Kilgore Minerals as a uranium enterprise inside a gold exploration firm. That should come to be evident as you keep on looking at this. And the query was posed to Mr. Burmeister, “At the end of this 12 months, will Kilgore be improved acknowledged as a gold or uranium company.” Following a prolonged pause, he responded, “The goal in this article is to construct a mining business.”
Far from the incredibly advertising Howe Avenue area, where by the greater part of the TSX Venture trade corporations have offices, Burmeister is just about reclusive in a little town in Wyoming. “It really is about 10 miles to the nearest prevent gentle,” he informed StockInterview. In fact, Dubois, Wyoming where by you may find Mr. Burmeister is a lot less than 80 miles away from Yellowstone National Park. (Hold driving west on US 287, and you’ll be in Montana.) When we hear a enterprise CEO talking up that he is likely to develop a mining business, the phrase “grain of salt” will come to thoughts. But a watchful evaluation of Mr. Burmeister’s resume will snap even the most cynical out of that body of thoughts, setting up with his graduation from the Colorado University of Mines as a geological engineer. (See bio snapshot at the conclusion of the report.) He is observed and created a gold mine, uncovered deposits, offered them to a big corporation. Been there, done it, and now he is all set for something even larger.
Kilgore Mineral’s Uranium Tasks
Now, Burmeister has obtained a few gold and 12 uranium properties. The uranium houses are convincing, and the business programs a drill system on a person, in Nevada. “We are in the procedure of allowing a person property for a summer time drill system. It is really a Nevada residence that was drilled out by Utah Mining and Development, which became a division of Standard Electric powered. It subsequently turned Pathfinder Mines, when GE was requested to divest their uranium mining and making facilities.” He’s referring to the firm’s 46-claim Mountain West property in Elko, Nevada. 1 could suspect the hand of Dr. Dieter Krewedl in this home range. Dr. Krewedl was vice president of exploration for Pathfinder in 1990 – 1995 (and also serves on the board of administrators of Strathmore Minerals).
“It can be not the major house in our portfolio, but it really is handy,” Burmeister reported humbly. “It really is in a superior jurisdiction in ELKO County, Nevada. It is one thing that we can get permitted and shift ahead. It is really a relatively low expense kind of procedure. It really is a thing we believe our enterprise with our sources can advance appreciably inside of a funds that is not likely to commit the firm’s complete assets.” Burmeister believes the Nevada uranium asset may well have a good grade. “It can be near surface area with primarily a small stripping ratio, so it could be mined with a slot sort of mining operation,” he described. When a deposit is relatively shallow, the slot sort mining strategy can be utilised, similar to how a quarry is mined.
His two Wyoming homes in Criminal County, comprising 122 promises, were beforehand drilled by distinctive important organizations in just about every of the a few claim blocks. Homestake Mining drilled in excess of 3,000 holes as late as the mid 1980’s on the 48-claim New Group block. In one particular spot by yourself, inside a 40-acre tract, in excess of 250 holes have been drilled (about 6 holes per acre). Bethlehem Steel’s 2 statements in the Oshoto Group consist of an admittedly a tiny house. “But it is right in the centre of what was designed in the late 1970’s,” Burmeister insisted. The joint undertaking, among Bethlehem Steel and a California-dependent oil organization, did a prosperous check ISL operation on the house in 1979. As they were winding down the exam, and analyzing the effects, they experienced to contend, as did quite a few other uranium exploration companies, with the general public outcry following Three Mile Island.
A different uranium assets block, the 72-declare Wooden Group, was also thoroughly drilled, by Homestake and Pioneer Nuclear. It is approximated several hundred holes explored the property, and 115 holes ended up drilled on one particular 160-acre tract. Burmeister hinted his uranium deal was nonetheless currently being assembled. The firm’s internet site notes, “The Enterprise will continue its efforts on the spot and acquisition of historic data associated with its portfolio of uranium properties.”
What tickles Norman Burmeister’s fancy about this space? “It is the Inyan Kara group,” he explained. His leases are aspect of a much larger package deal. “There is roll entrance Cretaceous sediment that surrounds the Black Hills. We have homes on northern part of the procedure in Montana, we have homes on the western flank, and this is in addition to lands on the roll entrance on the japanese flank of the Black Hills.” And what tends to make this crucial? “It is the equivalent to the stratigraphic unit that has been very successful in the Powder River Basin,” discussed Burmeister. “It is also been successful at its southern extremity in South Dakota in the Edgemont District.”
Other individuals have been saying uranium leases in Wyoming, and the condition has become a hotbed of statements announcements in new months. How did Kilgore Minerals come throughout these? “We arrived by some facts in a deal of knowledge we ordered that integrated the definitive place of the roll front,” discussed Burmeister. “I will not assume that information was commonly known. Which is why these leases ended up not picked up in the past. I feel folks didn’t know where by that roll front was. That roll front was described by a significant uranium firm with over 15 many years of exploration in the area, getting drilled I never know how a lot of hundreds of reconnaissance drill holes of these items, like one particular per square mile, above quite a few counties: northeastern Wyoming, southeast Montana, and western South Dakota. That facts led to the definition of the roll entrance the place these uranium deposits take place.” With that reported, Mr. Burmeister is quietly self-confident.
The Kilgore Gold Undertaking
But which project will get Norman Burmeister conversing breathlessly? Ask him about the firm’s Kilgore gold property in southeastern Idaho. “I am extremely thrilled about this challenge,” explained Burmeister. “It was a house that was really superior on Echo Bay’s listing. At the time they ended up energetic, Echo Bay was a single of the big gold explorers of the entire world. They had a very massive budget. This was just one of their major jobs, probably even their top project.” In fact, Echo Bay had drilled 122 holes (82,987 feet of drilling) in 1994-96, and bought out Placer Dome for 100 p.c ownership of the assets. The collapse of junior gold exploration in 1997 led to the challenge (and all Echo Bay projects) getting shelved. Kennecott, Placer and Pegasus just about every drilled the gold residence among 1983 and 1994. Kilgore Gold (wholly owned subsidiary of Kilgore Minerals) acquired 100-per cent possession of the house, immediately after the exploration field experienced contracted. The sensible invest in at the bottom of the cycle, which is what Norman Burmeister did.
All through 2006, the key show for Kilgore Minerals will probably be the summer time drilling software on the Kilgore gold residence, comprising 150 unpatented statements in excess of an place of roughly 4.7 sq. miles. The specialized report (National Instrument 43-101) was filed on the house by G.H. Rayner and Associates, which approximated 218,000 ounces of gold indicated and 269,000 ounces of gold inferred. To ascertain that estimate, nearly 200 diamond and reverse circulation drill holes for far more than 126, 000 feet were completed. Key gold businesses expended more than $8 million to deliver this home to this level of comprehension.
As a source, much less than 500,000 ounces is a smaller deposit. Nevertheless, a drill intersection, through the summer time 2004 drill program, struck a 10-foot area averaging .465 ounces/tonne or 14.5 grams per tonne gold. Specified the “Elsa Zone” discovery hole, the intersection uncovered that gold sample a lot more than 4,600 toes from the 487,000-ounce gold resource.
A preliminary structural investigation by Stanton W. Caddey, a remarkably highly regarded geological specialist, concluded in an Oct (2003) report:
“The Kilgore prospect region signifies a superior high-quality gold venture, considerably of which stays to be drill examined. Most the earlier drilling was centered along a peripheral or satellite segment of the key hydrothermal program…. The main exploration probable is for a bonanza, epithermal, gold-rich vein process localized along the significant N60W-trending McGarry Canyon NW fault zone and subordinate faults in the area referred to as Dog Bone Ridge… Exploration potential at the Kilgore home for a lot more than doubling the existing gold useful resource with further exploration drilling is regarded as exceptional.”
In May well 2004, Mine Progress Associates of Reno, Nevada finished a scoping level update of Echo Bay’s 1996 preliminary engineering assessment of the Kilgore task. Neil B Prenn, P.E., agreed this is a significant epithermal gold deposit, hosted in volcanic and sedimentary rocks, and the source is hosted inside of quartz stockwork and in silicified sedimentary rocks. In examining Echo Bay’s operate, he noticed that as a substitute of calculating a reserve for the home, they described an “estimate with substantial self-confidence, the prospective mineable element of the sources,” at 10.087 million tonnes, averaging 1.28 grams/tonne, made up of 417,000 ounces of gold. The engineer concluded, “The venture appears to have fairly beautiful economics if the ‘potentially mineable material’ can be doubled at $375/ounce gold rate.”
Burmeister believes the most effective is however to occur. His summary of Echo Bay’s preceding drilling was basic and to the stage, “They were targeted on a lower-quality open pit occurrence, which is quite awesome. It has a significant source. In their enthusiasm to shift that unique facet of the undertaking ahead, I feel they did not have the chance to step back and glimpse at the total hydrothermal process, which we have carried out. Burmeister extra, “We imagine the very best may possibly be yet to occur by exploring for a substantial quality underground form of procedure which is pretty considerably in favor these times.”
The successful drill gap was a blind discovery at 410 toes of depth. Burmeister clarified, indicating “The to start with gap that we drilled, we ended up prosperous in exploring a ‘blind’ substantial grade occurrence of gold beneath the barren sinter.” He understood the error produced through the 2004 drill system, “In our enthusiasm to get our arms all over this target location, which we get in touch with the Pet Bone Ridge place, we took massive action-outs, and never offset that large quality gap. Subsequent holes ended up all exciting, museum high quality realgar mineralization and stibnite mineralization, which are diagnostic of the epithermal design we’re testing. We acquired anomalous gold, but we failed to get any ore grade content.”
The Pet dog Bone Ridge region, as determined by geochemistry, geophysics, geology and framework, is at the very least 6,000 toes extensive and 1,800 ft huge. Burmeister discussed his much better being familiar with of the goal spot, “We assume this is a incredibly modern geological incidence, and has not been eroded. Commonly, there is no gold on the area on these programs. It will come as the result of boiling. The gold is precipitated out at that stage and does not achieve the surface. We’re essentially working with a paleo-surface area. Our discovery gap was further in the procedure, underneath the zone of boiling. So I you should not imagine the other drilling we did, the other main holes, they did very little but boost our interpretation of the system.”
In July, Kilgore Minerals will continue in which drilling remaining off in 2004. A recent information release announced, “The summertime 2006 drill plan is envisioned to commence in July with the initially holes built to offset the Elsa Zone discovery. There are a range of Elsa ‘look-alike’ definitive targets within the overall Pet dog Bone Ridge concentrate on location that will also be analyzed.” How does Norman Burmeister describe this in layman’s conditions? “We are likely to offset that discovery gap and find out what that’s all about,” he instructed StockInterview. “We will go about the business of assessing that challenge for the reason that it is all potential. We were being focusing on a projected structural intersection of which there are numerous. The success we had with that very first gap, it’s not special in terms of what we know in the geophysics, the geology, the framework and the geochemistry. That’s not to say that all of these targets are heading to be thriving, but the dimensions of this system signifies it can host a incredibly major useful resource.”
It was an enjoyable discovery hole, and the summer season 2006 drilling plan could spell achievements if drilling final results match Burmeister’s enthusiasm. In closing, he reported, “That gap could very well be ideal smack in the middle of an ore overall body. We you should not know what the orientation of the zone is, for the reason that with 1 hole, it is unachievable to know what the dip and the strike is. We will not know if it is really shut to accurate width or we strike it at the higher angle. But, it can be very exciting.”
Continue to be Tuned.
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