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Great Basin Gold Ltd. reports on the
progress of exploration, development and production activities at its
Hollister trial mining operation in Nevada, USA and its Burnstone
Mine in South Africa.
Hollister Gold Project
The Nevada operations reported an
increase in production related, mainly, to higher tonnages from trial mining
and improved operational performance of the Esmeralda mill, resulting in
approximately 31,000 gold equivalent ounces (Au eqv
oz) being sold during Q4 2010. This is a substantial increase over the 11,000
Au eqv oz sold in Q3 2010. Cash costs were also
lower at approximately US$680/oz, a 20% quarter-on-quarter improvement.
Additionally, 3,500 ounces were delivered to the refinery; these will be
recognized as revenue in Q1 2011.
At the Hollister Project, initial trial
mining in the newly discovered Blanket Zone yielded 500 tons at a grade of 15
Au eqv oz/ton (510 g/t), containing an estimated
7,500 Au eqv oz. A short 15-foot section of the
180-foot length of the high grade stope has been
trial mined for 50 feet vertically to establish the vertical extent of the
Blanket Zone in this area. Activities are focused on opening up the stope to determine the southern and northern limits and
to establish a platform to trial mine the total payable zone, including the
high grade centre and the surrounding lower grade halo (est. 0.6-1 oz/ton).
Delineation drilling of the zone immediately adjacent to the 3000 N 1 E stope has already commenced.
The Company continues to work with the
Federal Mine Safety and Health Administration (MSHA) through their
established process to ensure that Hollister will remain a safe and
productive mine over the long term. The MSHA inspections have not adversely
affected the productivity of the operation.
Burnstone Gold Mine
At the Burnstone
Mine, the capital expenditure program has generally been completed with the
vertical and ventilation shafts commissioned. The mine has commenced with
production build-up. Development continues with 5,747 meters of on-reef
development completed to the end of December 2010.
The focus of current work is to increase the rate of stoping
panel development and Long Hole Stoping; both are progressing well.
The metallurgical plant was successfully
commissioned and commenced milling low grade development ore by mid-October
2010; 65,534 tonnes of low grade ore had been
treated by end of December 2010. The Company was not in the position to
declare commercial production prior to the Christmas break in December.
During the first 17 days of January 2011, 51,653 tonnes of production material was treated, which is in
line with the planned build up for the metallurgical plant. A total of 2,186
ounces of gold has been recovered, including 9 kg (289 oz) by gravity, 34 kg
(1,093 oz) loaded onto carbon and 25 kg (804 oz) in residue. Due to the
lower grade of the development ore being processed by the mill, an average
recovery of 86% was achieved but is expected to increase to 95% when higher
grade material is processed. It is expected that commercial production
will be reached by end January 2011.
At January 17, 2011,
there were 156,000 tonnes on the ore stockpile at Burnstone.
Exploration and Development Drilling
Exploration and evaluation drilling has
continued at both the Burnstone and Hollister
operations. At Burnstone, drilling is currently
being conducted from surface and underground to provide infill evaluation and
structural data on future mining blocks. Block evaluation is being advanced
by detailed underground channel sampling of on-reef mine development
exposures.
In Nevada, underground exploration and
evaluation drilling is focusing on the high grade Blanket Zone, Velvet and
Southeast Gwenivere targets. The Blanket Zones are
characterized by disseminated gold mineralization that occurs in volcanic
rocks that overlie the older metasedimentary rocks
that host the main epithermal vein systems. Recent mine development has
exposed a mineralized zones that extends 180 feet (60 meters) and with an in
situ grade of 22 oz/ton Au, fully diluted over 3.5 feet (1.2 meters).
Currently, a 33-hole, 16,000-foot (4,864- meter) drilling program is underway
at the Blanket Zone. The second in a fan of drill holes was completed January 16, 2011. This objective of the program
is to enable grade shell modelling2 and assessment of the vertical
continuity of the mineralization associated with the Clementine #13-19 and Gwenivere #5-9 epithermal veins.
Two long, low angle boreholes are
planned to test the targets in the Velvet area and the intervening ground
located up to 3,000 feet north of the current mine infrastructure. To January 16, hole HDB 433 in
this area had progressed to 2,500 feet. It has intersected a number of zones
of clay and silica veining, and broader zones of silicification
and brecciation. Initial assays are pending.
A number of intersections have been
received for exploration boreholes testing the SE Gwenivere
target. HDB-423 encountered three significant gold intercepts from
the Southeastern Gwenivere Vein System. The
first is 0.1 feet (0.03 m) quartz veinlet at
23.1-23.9 feet (7.0-7.3 m). This veinlet is
a healed vein breccia with clasts
of argillite and milky quartz clasts that rarely
contain visible gold up to 5 mm thick. This veinlet
had a grade of 15.90 opt (545.0 g/t) Au and 5.8 opt (200 g/t) Ag.
A second was intercepted from 28.6-35 feet (8.7-10.6 m) and included a 6.4
feet (1.9 m) zone of moderate quartz stockwork,
with veinlets in this zone up to 0.07 feet (0.02 m)
thick. This zone had a composite grade of 0.696 opt (23.86 g/t) Au and
0.3 opt (12.9 g/t) Ag.
The last significant intercept was a 13.0
feet (4.0 m) zone of weakly healed breccia
encountered from 40-53 feet (12.2-16.2 m). This breccia
cuts minor spiderweb quartz stockwork
in moderately silicified argillite and quartzite and is weakly healed by
white clay. This 13.0 feet (4.0 m) zone had a composite grade of 2.766
opt (94.82 g/t) Au and 1.3 opt (45 g/t) Ag.
There was only one notable gold
intercept in HDB-424 at 24-28.2 feet (7.3-8.6 m). This 4.2
feet (1.3 m) intercept contained moderately silicified argillite with
minor white clay along few fractures and graded 0.776 opt (26.61 g/t) Au
and 0.5 opt (17.8 g/t) Ag.
Ferdi Dippenaar,
President and CEO, commented: "After nearly four and a half years, the Burnstone mine is up and running. Our short term
focus is on underground development which will provide for a progressive
build up in production over the year. 2011 will be our first full year of
production.
At our Hollister project, production
from trial mining has increased in line with our plan from 275 tons per day
to an average of 325 tons per day. The exciting new Blanket Zone and
Southeast Gwenivere discoveries are currently under
active exploration, and the information being gathered will assist in
determining the extent and value of these new zones. Both zones are located
near to existing infrastructure, which would facilitate rapid
development."
Phil Bentley, Pr.Sci.Nat.
(SACNAS) Vice President for Geology and Exploration for the Company and a
qualified person, and Johan Oelofse, PrEng, FSAIMM, Chief Operating Officer for the Company
and a qualified person, have reviewed this news release on behalf of Great
Basin.
Great Basin is a mining company engaged
in the exploration and development of gold properties. The Company is
currently focused on bringing two mines into production in the world's two
richest gold regions. The Hollister gold project is located on the Carlin
Trend in Nevada, USA and the Burnstone gold mine,
is located in the Witwatersrand goldfield of South
Africa.
Ferdi Dippenaar
President and CEO
Samples collected from
Hollister trial mining are delivered to the First Gold Laboratory in
Lovelock, Nevada for analysis. The pulps of these samples are now
being sent to Inspectorate America Corporation in Sparks, Nevada for
checking. At First Gold, vein samples are analyzed by standard fire
assay procedures. For standard fire assay, vein sample preparation
consists of drying and jaw-crushing the entire sample to 90% passing
10-mesh, taking a 300 g sub-sample using a Jones splitter, and then
pulverizing the 300 g sub-sample to 90% passing 150-mesh using a large
capacity ring and puck pulverizer. A 30 g
charge is fire assayed. All metal determinations are by gravimetric
finish.
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No
regulatory authority has approved or disapproved the information contained in
this news release.
This document contains
"forward-looking statements" that were based on Great Basin's
expectations, estimates and projections as of the dates as of which those
statements were made. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as
"outlook", "anticipate", "project",
"target", "believe", "estimate",
"expect", "intend", "should" and similar
expressions. Forward-looking statements are subject to known and unknown
risks, uncertainties and other factors that may cause the Company's actual
results, level of activity, performance or achievements to be materially
different from those expressed or implied by such forward-looking statements.
These include but are not limited to:
- uncertainties and costs related to the Company's exploration and
development activities, such as those associated with determining
whether mineral resources or reserves exist on a property;
- uncertainties related to feasibility studies that provide
estimates of expected or anticipated costs, expenditures and economic
returns from a mining project; uncertainties related to expected
production rates, timing of production and the cash and total costs of
production and milling;
- uncertainties related to the ability to obtain necessary
licenses, permits, electricity, surface rights and title for development
projects;
- operating and technical difficulties in connection with mining
development activities;
- uncertainties related to the accuracy of our mineral reserve and
mineral resource estimates and our estimates of future production and
future cash and total costs of production, and the geotechnical or hydrogeological nature of ore deposits, and
diminishing quantities or grades of mineral reserves;
- uncertainties related to unexpected judicial or regulatory
proceedings;
- changes in, and the effects of, the laws, regulations and
government policies affecting our mining operations, particularly laws,
regulations and policies relating to
- mine expansions, environmental protection and associated
compliance costs arising from exploration, mine development, mine
operations and mine closures;
- expected effective future tax rates in jurisdictions in which our
operations are located;
- the protection of the health and safety of mine workers; and
- mineral rights ownership in countries where our mineral deposits
are located, including the effect of the Mineral and Petroleum Resources
Development Act (South Africa);
- changes in general economic conditions, the financial markets and
in the demand and market price for gold, silver and other minerals and
commodities, such as diesel fuel, coal, petroleum coke, steel, concrete,
electricity and other forms of energy, mining equipment, and
fluctuations in exchange rates, particularly with respect to the value
of the U.S. dollar, Canadian dollar and South African rand;
- unusual or unexpected formation, cave-ins, flooding, pressures,
and precious metals losses (and the risk of inadequate insurance or
inability to obtain insurance to cover these risks);
- changes in accounting policies and methods we use to report our
financial condition, including uncertainties associated with critical
accounting assumptions and estimates;
- environmental issues and liabilities associated with mining
including processing and stock piling ore;
- geopolitical uncertainty and political and economic instability
in countries which we operate; and
- labour strikes, work stoppages, or other interruptions to, or
difficulties in, the employment of labour in
markets in which we operate mines, or environmental hazards, industrial
accidents or other events or occurrences, including third party
interference that interrupt the production of minerals in our mines.
For further information on Great Basin
Gold, investors should review the Company's annual Form 40-F filing with the United States Securities and Exchange Commission www.sec.com
and home jurisdiction filings that are available at www.sedar.com.
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1Gold equivalent here and elsewhere in this document was
calculated using a gold price of US$1,000 per ounce and a silver price of
US$15 per ounce.
2 3-D modeling of the gold grades as derived from a combination of
sampling of diamond drilling and mining development that creates a shape or
"shell" depicting the interpreted extent of economic
mineralization.
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