Summary
The Almaden Property is located in western Idaho, about 13 miles east of Weiser in Washington County, and lies on the south-eastern edge area of the Columbia Plateau. Most of the gold mineralization at the Almaden Property is in the Main and North zones, located on the south-western flank and northern ridge crest, respectively, of Nutmeg Mountain. The Almaden Property is comprised of about 3,260 acres, which includes 12 patented lode mining claims, 137 unpatented lode mining claims, and about 280 acres of private fee ground. The Main Zone of the Almaden deposit forms a continuous, near-surface, sub-horizontal zone of gold mineralization that extends over a strike length of greater than 3,500-feet. Including the North Zone mineralization, near-surface hot-springs-related gold mineralization on Nutmeg Mountain extends for over 5,000-feet in strike length. The Stinking Water Zone Inferred resource, which lies 2,000 feet to the north, and 600 feet below the Main Zone resource - is possibly related to a deeper emplacement of mineralization within the hot springs system, and could be indicative of higher-grade; structurally controlled mineralization beneath the Main Zone resource.
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Geological
The Almaden Property lies within the broad axis of the northwest-trending Sturgill Peak anticline in which the Payette Formation has been exposed as an erosional window in the Miocene basalts. The property is centered on Nutmeg Mountain, which owes its positive topographic expression to hydrothermal silicification of Payette sandstone. Variably silicified Payette Formation arkosic sandstones and lesser siltstones are underlain by unsilicified and generally unaltered claystone in the deposit area. The arkosic sandstone unit in the area of the Main Zone is overlain by an often chalcedonic, multi-lithologic debris breccia that is in turn overlain by a sinter blanket. Mercury, as cinnabar, is present in the sinter and has been the focus of mining in the past. Gold mineralization is hosted primarily in the underlying Payette Formation, which has been subjected to multiple phases of hydrothermal alteration, brecciation, and veining. North-northeast-trending high-angle faults appear to be having been active both before and during the mineralizing events, while northwest-trending high-angle faults appear to be syn-mineral and the main controls on Almaden gold mineralization. A set of nearly east-trending high-angle faults with limited apparent movement are likely post-mineral in age. Alteration types recognized at the Almaden Property include silicification, argillization (acid alteration), and carbonatization. Silicification is by far the most common and widespread alteration at the Almaden Property, ranging from silica veining through silica flooding to total silica replacement of the host rock. Argillic alteration is common, ranging from weak clay alteration to nearly total argillization of the arkosic sandstone. Below and in the lower part of the mineralized zone, calcite quartz alteration is common. Its significance relative to individual veins or the deposit as a whole is uncertain.
Gold mineralization at the Almaden Property is hosted primarily in Payette Formation arkosic sandstone and occurs in near-surface sub-horizontal tabular zones. The mineralization was deposited in a hot-springs environment and is associated with multi-phase hydrothermal brecciation and veining, strong silicification, acid alteration, and faulting. Siliceous sinter, composed primarily of opaline silica, caps and appears to have pre-dated the gold mineralization. Mercury is present in the hydrothermal system that deposited the gold at the Almaden Property and has been mined in the past. Gold mineralization at the Almaden Property that is included in the resources reported herein occurs in three zones: the well-defined Main and North zones and the less well-drilled Stinking Water Zone. The Main Zone mineralization occurs over a length of about 4,000-feet, a width ranging from 600 to 1,700-feet, and a vertical thickness of up to 700-feet. The zone trends northwest and contains about 75% of the mineral resources. The North Zone underlies the narrow ridge crest at the north end of Nutmeg Mountain, 2,000-feet northeast of the Main pit in the north end of the Main Zone. Mineralization occurs over a north-northwest strike length of 2,000-feet, a width ranging from 400 to 800-feet, and a vertical thickness of up to 250-feet, with the majority of mineralization within the upper 150-feet. The Stinking Water Zone lies 2,000-feet northwest of, and 600-feet lower in elevation than, the Main Zone. Low-grade mineralization occurs over a 1,200-foot by 800-foot area that strikes north-northeast and has a shallow dip to the west. The thickness is variable and not well defined, but is about 100 to 150-feet in the presently defined center of mineralization. The Stinking Water Zone includes some of the higher individual assays for drill samples in the project area. Gold is present as particles of native gold ranging from <1 to 9 microns in size. No visible gold has been reported from the property. Some portion of the gold is encapsulated in silica or is intimately associated with framboidal pyrite that is in turn silica encapsulated. Silver content of the gold averages 25%. Very fine-grained cinnabar occurs primarily in the sinter and is typically deposited along fractures, in veinlets, and as surface coatings in cavities. Multi-element analyses used in Freegold's 2006-2007 drill program indicates the presence of molybdenum at low concentrations throughout the Almaden deposit, with increased concentrations of between 0.03% and 0.05% Mo over thicknesses of about 150 to 225-feet within the northern parts of the Main Zone and the North Zone. Values as high as 1.39% Mo were encountered in drilling at depth beneath the North Zone. The relationship between the gold and molybdenum mineralization, if any, has not been determined.
The Almaden mineralization is variably oxidized, with oxidation levels ranging from tens of feet to greater than 300-feet. Stacked sequences of oxidized/partially oxidized material to unoxidized material and back into oxidized/partially oxidized material are common and are especially evident in the Main Zone. The shallow sulfidic material often occurs within strongly silicified, less fractured rock that is less permeable to circulating oxidizing fluids.
Exploration and Mining History
Cinnabar was discovered on Nutmeg Mountain in 1936. During three periods from the late 1930s to 1972, mercury was produced from the Almaden mine on Nutmeg Mountain. Although reports from the late 1930s mentioned the presence of gold with grades of 0.01 to 0.02oz Au/ton, there is no evidence of any gold production from the mine. Homestake Mining Company ("Homestake") initiated exploration at Almaden as a gold property in 1979 following the discovery of the McLaughlin gold deposit in California, which is associated with mercury and hot springs. Six other companies explored the property until it was acquired by Freegold in 1995. Prior to Freegold's involvement, 678 rotary, reverse circulation, and core holes totalling over 133,000-foot of drilling had identified gold mineralization in the Main and North zones; an additional 55 holes were drilled in the nearby Cove Creek and Stinking Water Basin areas. Numerous metallurgical studies were undertaken by prior operators. Freegold optioned the property in 1995 and in the next two years conducted geologic mapping, prepared new geologic cross sections, and carried out a metallurgical program that included the drilling of 10 large-diameter core holes and the collection of bulk samples from surface trenches. A historical feasibility study was completed for Freegold by Watts, Griffis, and McOuat Limited in 1997; work on the property was suspended due to the declining gold price. In late 2005, recognizing the potential for higher-grade feeder-zone mineralization, Freegold commissioned Freeman and Graham to prepare a NI 43-101 technical report and review the 1997 historical feasibility study. Freegold initiated reverse circulation and core drilling in 2006 to expand and infill the resource described in the 2006 Freeman and Graham technical report and to bring greater detail to the geologic model. This work culminated in the new resource estimate presented in this report.
Mineral Resource Estimation
The Almaden database used in the current resource estimate contains 886 drill holes and a total of 36,361 gold assays and 15,571 cyanide-soluble leach analyses. Over 48% of the gold assays within the database are from conventional-rotary drilling, 38% from reverse-circulation drilling, and the remaining 14% from core drilling. The database also contains 255 specific gravity measurements on Freegold 1996 and 2006-2007 drill cores.
Three geologic models were created based on 50-foot-spaced, east-west oriented cross-sections: a geology/density model, a gold mineral-domain model, and a cyanide soluble-to-fire assay ratio ("CN ratio") model. The geology/density model contains eight rock types, each with a unique density value. These eight rock types are roughly based on lithology and alteration, primarily degree of silicification and argillization, and also on their spatial relationship within the geologic model. The gold mineral domain model contains four population domains whose cross-sectional boundaries are guided by the geology model. The four gold domains, identified by unique gold populations and geologic characteristics, have gold grade ranges of ~0.005 to ~0.01oz Au per ton, ~0.01 to ~0.03oz Au per ton, ~0.03 to ~0.065oz Au per ton, and >~0.065oz Au per ton. These domains generally represents the transition from weakly disseminated mineralization that is associated with weak to moderate silicification, to disseminated and structurally-controlled mineralization associated with pervasive silicification and increased hydrothermal brecciation and veining.
