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A Junior Mining Company With A Gold Mine Moving Into Production
Cross Lake Minerals Ltd. is a Vancouver based exploration and development company focused on precious metals. In 2001, in a market characterized by very low gold prices, the Company acquired the QR Mine from Kinross Gold Corporation. The QR Mine is a fully-equipped 1000 tonne per day facility. Cross Lake is now in the final stages of preparing the property for operations. When BC Hydro confirmed that power would be available for operation in July,
Cross Lake was able to finalize its operating schedule and now projects the commencement of operations in the third quarter of 2007. The Company also acquired several complimentary exploration projects predominantly in British Columbia, with the latest being the Porcher Island Project near Prince Rupert. Porcher Island has a long history of exploration and production and Cross Lake will continue diamond drilling and engineering to confirm and expand upon the historic resource that was reported by previous operators.
 Company Press Releases
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Kinross Gold Corporation operated the QR Mine, which included both open pit and underground operations, from 1994 until 1998 when operations were suspended because the gold price had declined to less than the production cost of C$300 per ounce. During that time, 118,400 ounces of gold was recovered from 1.06 million tonnes of ore at an average grade of 4.1 grams per tonne. The mine operated at a rate of over 1000 TPD for a period of 3 years.
The QR Mine Technical Report by Wardrop Engineering Inc. and Cross Lake's Engineering Consultants and the subsequent $10 Mill. Financing in June 2006 has allowed the QR Project to proceed. Initial capital required for the project is estimated at $6.5 million including $5.5 million for infrastructure and development and $1.0 million for working capital. The first phase of development from the "Existing Resource" is projected to produce over 84,000 ounces of gold and a Mine Operating Cash Flow of over $26 million at a $700 CAN gold price.
When the Company's engineering team reviewed the options for development of the existing resource on the QR Property several choices were considered and subjected to analysis. As a result of this process, it was concluded that the most efficient and therefore economic development plan was to develop only the easily accessible underground resource within the Midwest Zone, develop the defined Northwest Zone by open pit and the West Zone by underground mining. This plan generates a highly profitable economic model with a minimum of capital and an excellent cash flow over the first two years of mine operations.
In addition to the resource that is now being developed under, Cross Lake is now developing and drilling the North Zone, which is expected to extend the life of the mine substantially beyond that supported by the "Existing Resource". There is the potential for additional tonnage at depth below the Midwest Zone and further potential within the West Zone.
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| Properties Location Map |
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| QR Mine Site |
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Cross Lake is now proceeding with underground development, diamond drilling and if successful mingn operation of the North Zone of mineralization. The projected capital cost are $3.2 million for the underground development and a further $800,000 for underground diamond drilling. The proposed program will consist of a road access from the West Zone to a portal site that is optimum for underground development. The underground development consists collaring a portal, driving a 770 metre adit and a 300 metre crosscut with diamond drill stations every 50 metres. The crosscut will be parallel to the North Zone mineralization enabling detailed diamond drilling, which can not be easily completed from surface. The drilling program will consist of a minimum 5,000 metres.
The North Zone is located approximately 300-500 metres below the mill and is a faulted extension of the Main Zone, which was mined by open pit during previous mining operations. Company geologists and independent engineers have studied detailed technical information from this Main Zone development. The Main Zone, which has a strike length of only 300 metres produced over 100,000 ounces of gold, is very similar in character to the North Zone. The North Zone, which has been defined by surface diamond drilling along a strike length in excess of 1,000 meters, remains open and is the only zone on the QR Property that is not limited by faulting. A detailed study of the Main Zone included kriging a block model that overlaid the Main Zone open pit which showed contiguous block of over 300,000 Tonnes at greater than 5 g Au/t, a grade that can be mined from underground. Therefore, as the mineralization contained within the North Zone is an extension of the Main Zone, there is the potential to identify a significant additional gold resource to that now defined on the Property.
The North Zone will be an important contributor to ongoing mining operations and gold production.
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| Porcher Island Gold Project |
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Cross Lake has entered into an option agreement to earn a 65% working interest in the Porcher Island Gold Property (the "Property") from Imperial Metals Corporation ("Imperial"). The project is located in the Skeena Mining Division, 35 kilometres south-southwest of Prince Rupert, British Columbia. It consists of 13 Crown Grants and 13 legacy claims which total 80 units covering 1,895.4 hectares.
There is a long history of exploration and production from the Property, which includes the Surf Point and Edye Pass mines. Records indicate that a total of 77,952 tons grading 0.29 oz/t gold was produced until 1937 when a fire destroyed the mill. From 1975 to 1988 extensive exploration by E and B Exploration and Cathedral Gold Corporation resulted in a drill outlined mining reserve of 623,095 tons grading (cut and diluted) 0.20 oz/t gold over an average mining width of 11 feet. Within this resource there are significant high grade intercepts, which contain multi ounce material over mineable widths. A deep drilling program indicated the potential for an additional 900,000 tons at similar grades to a depth of 1,000ft below surface in the AT Zone. All resource figures were compiled prior to and are not compliant with NI43-101 requirements.
The gold mineralization occurs in pyritic quartz veins within steeply dipping shear or alteration zones hosted by a quartz diorite intrusive. Significant gold mineralization has been found to date in 4 zones, the AT, Slope, Edye and Alder.
Cross Lake is diamond drilling at depth to extend the zones of mineralization below 1000 feet and add to the overall resource potential. In addition an initial assessment of the development potential of the drill outlined mining reserve will also be completed.
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Corporate Office:
Cross Lake Minerals Ltd.
1255 West Pender Street, Vancouver British Columbia, Canada V6E 2V1
Telephone: (604) 687-2038
Fax: (604) 687-3141
Email: keevil@shaw.ca
Web site: www.crosslakeminerals.com
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Disclaimer:
The information herein may contains forward looking statements based on assumptions and judgments of the management of the Cross Lake Minerals Ltd. regarding events or results that may prove to be inaccurate as a result of exploration or other risk factors beyond its control. Actual results may differ materially from the expected results. All statements herein, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that Cross Lake Minerals Ltd. expects are forward-looking statements. Such forward-looking statements are not guarantees of future performance, and are based on numerous assumptions about future conditions that could change. The material contained herein is for information purposes only and is not and is under no circumstances intended to constitute an offer to sell or a solicitation to buy any securities or a recommendation as to the purchase of any securities. The information contained herein has been obtained from the above featured company as well as the other publicly available sources and is believed to be accurate. Although reasonable efforts have been made to compile this data with care, neither Investcom, its
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