Oxide gold mineralization intercepted over a 5km-long corridor

January 14, 2016

VANCOUVER, B.C. – Pilot Gold Inc. (PLG - TSX) (“Pilot Gold” or the “Company”) is pleased to report the second tranche of drill results from its inaugural drill program at the Goldstrike property in southwest Utah. The Goldstrike property hosts a past-producing gold mine within an eight km-long corridor of gold mineralization that is largely untested and ready to be drilled off. 

Goldstrike is located in the eastern Great Basin, immediately adjacent to the Utah/Nevada Border, and is a Carlin-style gold system, similar in many ways to the prolific deposits located along Nevada’s Carlin trend.  Like Kinsley Mountain and Newmont’s Long Canyon deposit, Goldstrike represents part of a growing number of Carlin-type systems located off the main Carlin and Cortez trends in largely underexplored parts of the Great Basin.  The exploration potential over the entire Goldstrike property is exceptional.

Pilot Gold acquired 100% of the project in 2014, and spent the past 16 months compiling data and prioritizing drill targets. The maiden drill program intersected gold mineralization in all areas tested over a 5 km-long corridor, indicating that gold is widespread, predictable and relatively structurally simple. 

Highlights from the latest round of drilling include:

• 18.3 metres grading 2.72 grams per tonne gold (g/t Au) in PGS012, including 10.7 metres grading 4.32 g/t
• 71.6 metres grading 0.48 g/t Au in PGS013
• 27.4 metres grading 0.66 g/t Au in PGS016

To view a table of full drill results, please click here.

To view the latest drill map, please click here.

“I am extremely pleased with the results of our maiden program at Goldstrike. We have intercepted primarily oxide gold mineralization over a 5km-long corridor, and we believe these results support our exploration objective to define a 2 to 3 million ounce gold system at Goldstrike,” stated Dr. Moira Smith, Chief Geologist, Pilot Gold. “Our strategy employed compilation and 3D analysis of a wealth of historic data, detailed geologic mapping and analysis, and modeling of geology and historic mineralization.  Combined with data from the recently-completed drill program, this information will be used in the coming months to quantify the gold endowment in the main mine trend.” 

Results from the first 10 holes released, December 1, 2015, tested a regional unconformity down-dip to the north of a cluster of historic pits over a strike length of 1.2 km on the east end of the Goldstrike mine trend, and included: 

• 39.6 metres grading 1.01 g/t in hole PGS003
• 41.1 metres grading 0.84 g/t Au in PGS004
• 22.9 metres grading 1.68 g/t Au in PGS008
• 36.6 metres grading 1.06 g/t Au in PGS010

The 8 drill holes from this second tranche of results tested targets in a variety of settings along 2 km of the western portion of the mine trend. Two of the holes ended in mineralization, such that the main intercept length and grade reported represent incomplete tests of the mineralized zone. Of note are the higher-grade intercept in PGS012, hosted entirely within an altered dyke of unknown strike extent, and a long intercept of mineralization in PGS013, representing the first test of a previously unidentified area of mineralization located below the historic Moosehead Pit.     

Pilot Gold expects to resume drilling in March to focus on extending and defining mineralization along the main gold trend.  Surface geological mapping and prospecting of the large property is ongoing, with a number of new targets identified. 

Pilot Gold now has two Carlin-type, sediment-hosted projects in mining-friendly Nevada (Kinsley Mountain) and Utah (Goldstrike). The Pilot Gold team has proven experience and success in discovering Carlin-style deposits off the main trends, having advanced Long Canyon in Nevada, now a multi-million ounce, high-grade oxide, open-pit deposit owned by Newmont.

About Goldstrike

In August 2014, Pilot Gold acquired Cadillac Mining, gaining control of 100% of the Goldstrike project. Since the acquisition, Pilot Gold has compiled a digital database of drill holes (+1,500), blast hole samples (+100,000) and historic rock and soil samples, and has constructed a 3D model of geology and mineralization. 2014 and 2015 fieldwork included collection of an additional 1,384 soil samples and 294 rock samples, staking of additional claims and detailed mapping. Gold mineralization is primarlily located along a regional, early Tertiary (Eocene) unconformity that is virtually untested under shallow cover where it extends downdip of mineralized surface exposures, which are present throughout the entire Goldstrike tenure.

The Goldstrike Mine produced approximately 209,000 ounces of gold with an average grade of 1.2 g/t gold from an open pit heap leach operation between 1988 and 1994.  There is currently an extensive exploration database, a large number of shallow drill holes with unmined oxide gold intercepts, and numerous untested gold targets. Pilot Gold’s exploration strategy at Goldstrike is focused on identifying additional areas of mineralization proximal to, and downdip of, the historic pits, under shallow cover.

The Company also advises that Vance Spalding, Vice President Exploration, has left Pilot Gold. The Company thanks Mr. Spalding for his contribution to Pilot Gold and wishes him well in his future endeavours. Mr. Spalding’s responsibilities will be reallocated among the current members of Pilot Gold’s management team.

Moira Smith, Ph.D., P.Geo., Chief Geologist, Pilot Gold, is the Company's designated Qualified Person for this news release within the meaning of National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101") and has reviewed and validated that the information contained in the release is accurate. Drill composites were calculated using a cut-off of 0.20 g/t. Drill intersections are reported as drilled thicknesses. True widths of the mineralized intervals are interpreted to be between 30-90% of the reported lengths. Drill samples were assayed by ALS Chemex (ISO9001:2000) in Reno, Nevada for gold by Fire Assay of a 30 gram (1 assay ton) charge with an AA finish, or if over 5.0 g/t were re-assayed and completed with a gravimetric finish. For these samples, the gravimetric data were utilized in calculating gold intersections. For any samples assaying over 0.200 ppm an additional cyanide leach analysis is done where the sample is treated with a 0.25% NACN solution and rolled for an hour. An aliquot of the final leach solution is then centrifuged and analyzed by AAS. QA/QC for all drill samples consists of the insertion and continual monitoring of numerous standards and blanks into the sample stream, and the collection of duplicate samples at random intervals within each batch. Selected holes are also analyzed for a 51 multi-element geochemical suite by ICP-MS.

ABOUT PILOT GOLD
Pilot Gold is led by a proven technical and capital markets team that continues to discover and define high-quality assets featuring strong grades, meaningful size and mining-friendly addresses. Our key assets include interests in the Kinsley Mountain project (Nevada) and the Goldstrike project (Utah) and the TV Tower and Halilaga projects in Turkey, each of which has the potential to become a foundational asset. We also have a pipeline of projects characterized by large land positions and district-wide potential that can meet our growth needs for years to come.

For more information, visit www.pilotgold.com or contact:

Investors:
Patrick Reid, VP, Corporate Affairs
Phone: 604-632-4677 or Toll Free 1-877-632-4677
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All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to Pilot Gold within the meaning of applicable securities laws, including statements that address potential quantity and/or grade of minerals, potential size and expansion of a mineralized zone, proposed timing of exploration and development plans. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "planned", "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", and similar expressions, or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "should", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions about future prices of gold, copper, silver and other metal prices, currency exchange rates and interest rates, favourable operating conditions, political stability, obtaining governmental approvals and financing on time, obtaining renewals for existing licences and permits and obtaining required licences and permits, labour stability, stability in market conditions, access to ground water at Goldstrike and the related impact on permitting, the availability of equipment, the accuracy of any metallurgical testing completed to date, successful resolution of disputes (if any) and anticipated costs and expenditures. Many assumptions are based on factors and events that are not within the control of Pilot Gold and there is no assurance they will prove to be correct.

Such forward-looking information, involves known and unknown risks, which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking information, including, risks related to the interpretation of results at the Goldstrike property, the accuracy of historic technical information; changes in project parameters as plans continue to be refined; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; the costs and timing of the development of new deposits; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; the timing and success of exploration activities generally; delays in permitting; possible claims against the Company; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, financing or in the completion of exploration as well as those factors discussed in the Annual Information Form of the Company dated March 24, 2015 in the section entitled "Risk Factors", under Pilot Gold’s SEDAR profile at www.sedar.com.

Although Pilot Gold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Pilot Gold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.