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COLUMBUS GOLD CORPORATE UPDATE
Vancouver, British Columbia, Canada. May 12, 2008. Columbus Gold
Corporation (CGT: TSX-V) ("Columbus
Gold" or the "Company") is pleased to provide the following
corporate update.
EXPLORATION AND OPERATIONS
The Company's project activities continue to be managed by
Cordilleran Exploration Company ("Cordex"), owned and operated by
John Livermore and Andy Wallace. The Company's exclusive agreement with
Cordex has been extended to the end of 2009 and is renewable up to the end
of 2013 under certain conditions.
The Company's generative activities are designed to identify and
acquire projects with ore grade values in a geological setting with the
potential to host a large gold deposit amenable to open pit mining. During
the 2007 field season the Company's generative programs have resulted in the
staking and acquisition of five additional properties in northwest Nevada:
Grulla, Stage, Red Hills, White Horse Flats and Ferguson Flats. With the
2008 acquisition of the White Horse North Project and the Awakening
Property, Columbus Gold's portfolio now consists of 31 projects (click here for a location map)
which are 100% controlled (subject to underlying royalties) of which 25 are
gold projects located in Nevada.
To date the Company has optioned an initial interest of 51% to 60%
on 14 of its Nevada gold projects to third parties including Barrick Gold,
Newmont Mining and Agnico-Eagle. Columbus Gold believes that it is the 4th
largest landowner in Nevada based on number of gold projects and that it
ranks 2nd in the state for the most projects under option to third parties.
As new acquisitions are advanced and targets delineated through geological
mapping, geochemical sampling and geophysics, it is likely that other
projects will be optioned to third parties for drilling; additional
joint-ventures are anticipated in 2008.
The Company's joint-venture partners plan combined 2008 exploration
expenditures totaling an estimated $4.65 million on Columbus Gold projects
with drilling planned on up to seven properties including drilling by
Newmont Mining at Scraper located on the northern extension of the Carlin
Trend (click here)
and where they recently completed geochemical work, a gravity survey and
other geophysics in preparation for drilling; Barrick Gold has planned a
geophysical program in preparation for an anticipated 11,000 ft (3,352 m)
drilling program at Utah Clipper and Crestview located directly adjacent to
the Pipeline-Gold Acres gold mine complex on the Battle Mountain Trend (click here); and,
approximately 8,000 ft (2,438 m) of drilling is planned at Summit by
Agnico-Eagle Mines Limited to test geochemical targets identified in last
year's sampling program which consisted of approximately 2,500 soil, rock,
and stream sediment samples. The Summit Property is located within one mile
of Fronteer's and AUEX's drilling at the important Long Canyon discovery
and within 1.5 miles of Agnico-Eagle's and AUEX's drilling at the
Acrobat/Juggler discovery (click here).
In addition, subject to the availability of drill rigs, Sniper
Resources is planning to drill 24 rotary holes in a planned 14,400 ft
(4,389 m) program at Guild; four holes totaling 4,100 ft (1,249 m) are
planned by Platte River Gold at Chert Cliff; and, eight to ten diamond
drill holes are planned by Portage Minerals at Golden Mile.
In addition to the drill programs on these seven Columbus Gold
projects planned by joint-venture partners in 2008, Columbus Gold plans to
drill its Bolo and Awakening properties. Bonds are in place, permitting has
been obtained and a drill rig is scheduled to be delivered to Awakening in
June and subsequently moved to Bolo.
The Awakening Property was recently explored with a series of
excavator trenches followed by the drilling of six rotary holes in January
2008 (click here for detailed
results) which identified thick zones of
low grade mineralization in quartz stockworks, potentially minable by open
pit. A geologic mapping and geophysical program is in progress. Columbus
Gold has permitted 24 drill sites and expects to drill 12 holes in an 8,000
ft (2,438 m) Phase I program in June.
At Bolo, the 19 hole, 9,890 ft (3,014 m) Phase I drilling program
completed in December 2007 (click here for detailed
results) combined with surface sampling
and mapping, has confirmed the presence of a very large Carlin-type
mineralized system present over an area of at least 6 sq. miles (15.5 sq.
kilometers). Fifteen of the 19 holes completed intercepted anomalous gold
values, however, due to difficult drilling conditions several holes were
abandoned while still in alteration, prior to reaching planned target
depth. Detailed logging of the drill holes suggests that the Company may
have missed several important structures in its original surface mapping
program as the gold grades encountered were significantly lower in the
drill results then from surface sampling. Additional geologic mapping and
geophysical programs consisting of ten line miles of CSAMT surveying and a
ground magnetic survey are complete and are presently being interpreted. The
geophysics combined with the new mapping are assisting in identifying
cross-structures which may be controlling better grade. Columbus Gold has
permitted 33 drill sites and expects to drill 12 holes in an 8400 ft (2,560
m) Phase II drilling program designed to intercept these important
cross-structures and also test numerous untested targets. Phase II at Bolo
is expected to begin immediately upon completion of Phase I drilling at
Awakening.
FINANCIAL AND
CORPORATE
On May 5th, 2008, the
Company announced that it has transferred its Silver District, Silver Dome,
Clanton Hills and Keg silver properties to a newly formed subsidiary,
Columbus Silver Corporation with the intent of completing an initial public
offering ("IPO") to raise proceeds of up to $5,250,000. The IPO
process was chosen as the most effective way of maximizing the Company's
investment in its silver assets and the creation of a silver focused
company should provide an effective mechanism to finance exploration
activities while providing Columbus Gold and its shareholders with a
valuable retained interest in any future growth in value of Columbus Silver
and the silver projects. A 27 hole, 10,000 ft (3,048 m) drilling program is
planned for the Silver Dome Project on completion of the IPO.
Columbus Gold's current
working capital position of $2,359,000 combined with loan repayments and
consideration for the transfer of the silver assets to Columbus Silver of
approximately $1 million payable upon closing of the Columbus Silver IPO,
totals approximately $3.4 million and will more than enable Columbus Gold
to carry out its exploration plans and fulfill its projected general and
administrative expenditures into the first quarter of 2010.
At the Company's AGM
held on May 9th, 2008, John Prochau did not stand for re-election as a
Non-Executive Director but will remain actively involved in the Company's
affairs as a Special Advisor reporting to the Board of Directors on general
business strategy, project generation and development. Mr. Prochnau has
concurrently tendered his resignation as a director of several publicly
traded mining companies, reflecting his desire to focus exclusively on the
technical and geological aspect of the industry in his new capacity of
Special Advisor.
Andy Wallace is a
Certified Professional Geologist (CPG) with the American Institute of
Professional Geologists and is the Qualified Person under NI 43-101 who has
reviewed and approved the technical contents of this news release. Mr.
Wallace is a partner of Cordilleran Exploration Company
("Cordex"), which is conducting exploration and project
generation activities for Columbus Gold on an exclusive basis.
ON BEHALF OF THE BOARD,
Robert F. Giustra President & CEO, Director
For more information
contact:
Ray Lagace
Investor Relations
604-638-3474
info@columbusgoldcorp.com
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