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Drilling Results Increase Klondex's Gold Resource By Extending
Main and Far North Gold Zones at Fire Creek
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- Klondex Updates Progress on Permitting for Underground Development -
Vancouver, British Columbia: September 14, 2007 - Klondex Mines Ltd.
(TSX: KDX) reviewed progress from the Phase 6 drilling program at its
100%-owned Fire Creek property in the Battle Mountain-Eureka Trend in
Northern Nevada. The goal of the drilling program is to add to the
existing mineral resource base and find new zones of significant gold
mineralization at the Fire Creek property. These goals are being
accomplished utilizing:
1. "Extension" drilling in the boiling zone of the Main and Far North
resource area, and
2. "Exploration" drilling of potential mineralization targets
identified by an induced polarization (IP) survey conducted last year.
All thirteen Phase 6 "extension" holes have contributed valuable
information regarding the structural control and continuity of the Main
Zone and Far North Zone veining and are expected to increase both the
tonnage and grade from the previously announced NI 43-101 compliant
indicated resource at Fire Creek of 1,054,738 ounces of gold in
1,636,555 tonnes (19.88 grams per ton "gpt"). The Company has also
completed eleven "exploration" holes to test IP anomalies. While these
holes have not encountered new economic intercepts, several have
reported anomalous gold values and a few are considered highly
encouraging.
Commenting on the Company's progress, Robert Sibthorpe, Technical
Director, commented, "Our Phase 6 drilling program progresses well and
ahead of schedule, with results that will certainly enable Klondex to
expand its indicated mineral resource in our next formal resource
update. We believe our investment in exploration this year, estimated
at approximately $3.3 million CDN, is delivering a very attractive
return on investment to our shareholders in terms of driving an
increase in our gold and silver resource and the inherent value of our
company.
"On the permitting front, we are making good progress with several
agencies, however some unavoidable regulatory delays have required that
we extend our timelines for approvals and the commencement of
underground development by a few months. In the interim, we continue to
develop our underground plans, and our dialogue and negotiations with
several potential mining contractors continue, as do our conversations
with potential milling partners. While regulatory delay is unfortunate
but not unusual during this very active period in the industry, we are
making good use of the extra time to advance our planning."
As previously announced, Fire Creek's current Plan of Operations is
being amended to include up to 3,000 meters of underground workings to
permit access to the Main Zone on two levels. The permitting and
contractor selection processes associated with the Main Zone
underground program are progressing, though behind the company's
original schedule. Final permits are now anticipated by year-end 2007
or early 2008 with development work commencing immediately thereafter.
The underground workings will facilitate in-fill drilling to further
improve knowledge regarding grade and vein continuity.
Klondex has made application for designation as a "Small Scale
Facility" as defined by Nevada Regulation NAC 445A.377, allowing for
the extraction and processing in the Main Zone of a series of bulk
samples of not more than 33,180 metric tonnes of ore per year and no
more than 109,090 metric tonnes in total. Based on the Company's NI
43-101 compliant resource estimate, the weighted average grade of the
target areas for the bulk sample is 67 grams of gold per tonne.
Based on preliminary estimates developed in-house for permitting,
underground access, exploration, drilling, mining and other costs,
Klondex believes it could generate a substantial operating profit
during a three-to-four year underground development/bulk sampling
program, assuming no unforeseen circumstances.
PHASE 6 DRILLING RESULTS TO DATE
A plan map setting out hole locations is available on the Company's
website at http://www.klondexmines.com/s/News.asp
Fire Creek Resource Zone
The gold mineralization in the Main Area is in a swarm of epithermal
low-sulfidation quartz-carbonate veins striking NNW within a corridor
about 300 meters wide and about 1 kilometer in length. There are at
least 12 veins carrying significant gold values in the Main and Far
North Zones. The individual veins are usually 100-400 meters in length.
Important gold values are generally restricted in a vertical sense to a
"boiling zone" between 1750 to 1500 meters above sea level. Thirteen
new holes have been drilled during Phase 6 to test the large gaps
between or beyond drill intercepts used in the calculation of the
September 2006 resource estimate in an effort to increase the overall
indicated mineral resource while staying within its given restrictions.
>From north to south, these holes produced the following results:
SECTION 800N: Hole FC0727 tested the 100 meter gap between FC0525
(13.2gpt/9.8m) and FC0612 (34.1/3.2 m) and reported intervals of 7.8
gpt over 6.1 meters and 29.5 gpt over 1.52 meters in the Far North
Zone.
SECTION 400N: Hole FC 0709 tested the high grade Vein Set 7 through 4
at the bottom of the "boiling zone." As it approached Vein 7 from the
west, a low grade interval (1.3 gpt over 13 meters) was reported
followed by 1.5 meters of 42.5 gpt and at the projection of Vein 4 a
0.3 meter sample assayed 98.5 gpt. These veins are linked to the strong
gold values on Section 350N.
SECTION 250N: Hole 0706 reported no significant values on the down dip
extension of Vein 3 on this section.
SECTION 200N: Hole FC0705 tested the 120 meter gap between intercepts
on Vein 3 in holes FC0408 (14.2 gpt/2.1m) and FC0416 (5.6gpt/3.66m). It
returned a broad zone of 1.7 gpt over 13.7 meters, indicating that the
vein may have entered a porous host rock. Higher up the hole, between
projections of Vein 5 and 6, an interval of 13.0 gpt over 3.05 meters
was recorded.
SECTION 150N: Hole FC0704 (previously reported) had an intercept of
11.1 gpt over 5 meters. Hole FC0710 was collared on top of the Main
Zone to test IP anomaly "0" to the west and thus did not impact the
main Zone resource. It produced sub-ore intercepts, possibly
representing the new vein at IP anomaly "0".
SECTION 100N: Hole FC0703 targeted the down dip extensions of the
high-grade intercept in FC0621 on Vein 3. FC0703 returned an intercept
of 10.5 gpt gold and 160 gpt silver over 2.1m, 50 meters deeper. Hole
FC0711 (previously reported) was drilled westward, directed at IP
anomaly "0" outside of the Main Zone. As it passed through the
siliceous cap rock over the Main Zone it intersected 11.3 gpt over 3.05
meters in the RC portion of the hole about 50 meters below surface.
FC0711 also returned an intercept of 6 gpt over 3 meters which could
represent the IP "0" anomaly, a new vein some 100 meters west of the
current Main Zone boundary.
http://www.klondexmines.com/i/misc/sept_14_2007_table.jpg
SECTION 050N: Hole FC0702 (previously reported) targeted the down dip
extension of the high grade intercept from FC0619 on Vein 2 and
returned 21.7 gpt over 11.4 meters. Hole FC0708 filled the gap between
FC90143 (5.9 gpt/7.3m) and FC0507 (12.5gpt/2.44m) on Vein 2 and
returned 3.1 gpt over 9.1 meters.
Section 100S: Hole FC0701 (previously reported) intersected 1.5 meters
of 26 gpt gold about 180 meters below surface. It occurs on Vein 3 and
represents the southernmost economic intercept drilled to date at Fire
Creek. This hole was offset with FC0734 which returned 5.2 gpt over 6.1
meters at the same depth but 30 meters to the east. Hole FC0735 was
drilled beneath these 2 holes and returned a broad intercept of 1.6 gpt
over 34 meters, some 75 meters deeper. There has been very limited
drilling on this Vein further to the south and additional holes have
been scheduled.
Exploration Holes:
Assay results have been received for an additional nine holes, which
were directed at IP anomalies outside of the Main and Far North
Resource Zone. Although no economic intercepts were reported in these
holes, several IP anomalies reported anomalous gold values and a few
are considered highly encouraging. For instance, drill holes FC0732 and
FC0733, which tested IP anomaly 10, both contained +1.5 g/t gold
intercepts but below favorable host rocks. Testing of this gold-bearing
structure within rocks favorable for veining higher in the section has
been scheduled.
As of August 31, 2007, Klondex had 22,836,173 shares issued with and
cash of approximately $7.1 million CDN invested in Canadian treasury
notes and in guaranteed bank accounts. The Company has no exposure to
any derivatives, futures, hedges or related risks.
Richard Kern (P.Geo) of Reno, Nevada, is the Company's qualified person
on the project as required under NI 43-101and has reviewed the
technical information contained in this press release.
Klondex has in place a rigorous QA/QC program consistent with National
Instrument 43-101 and using best industry practice. ALS Chemex Labs of
Reno, Nevada and SGS Minerals services, Toronto responsible for all the
Klondex Mine's assaying.
About Klondex Mines Ltd.:
Klondex (TSX: KDX) is a gold exploration company focused on the
development and expansion of its high-grade Fire Creek deposit in
Nevada. Klondex has identified an Indicated Mineral Resource of over
1,000,000 ounces of gold at Fire Creek and has filed for permits to
begin bulk sampling of up to 120,000 tons ore. Fire Creek is located in
the Battle Mountain-Eureka Trend in the Northern Nevada Rift, in North
Central Nevada, an area of prolific gold production. Klondex currently
has two drill rigs working to expand its resource at Fire Creek. The
Company was founded over 30 years ago, and its property portfolio
contains four other gold exploration projects, all in Nevada. For more
information, please visit www.klondexmines.com.
ON BEHALF OF KLONDEX MINES LTD.
"William J. Solloway"
President
"Robert Sibthorpe"
Technical Director
Investor Contact:
David Collins, Steven Hecht
Jaffoni & Collins Incorporated
KDX@jcir.com
(212) 835-8500
Click on the link below for an attached map:
http://www.klondexmines.com/i/misc/FCDHPhase6PR09-14-07.pdf
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Copyright (c) 2007 KLONDEX MINES LIMITED (KDX) All rights reserved.
For more information visit our website at http://www.klondexmines.com/
or send mailto:info@klondexmines.com
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