Agreement adds 20 square kilometres of prospective ground bordering Kayali oxide gold target at TV Tower
VANCOUVER, B.C. - Pilot Gold Inc. (PLG - TSX) ("Pilot Gold" or the "Company") has reached an agreement under which Orta Truva, the joint venture company that holds the TV Tower project, will acquire 100% of the Karaayi project ("Karaayi") from a Turkish subsidiary of Chesser Resources Limited ("Chesser") for total consideration of 1,250,000 Pilot Gold common shares, issued in stages, and US$300,000 (the "Transaction").
The 20-square-kilometre Karaayi property is located immediately southwest of the TV Tower project and is contiguous with the Kayali oxide gold target. Upon closing, Orta Truva will become operator at Karaayi and plans to launch surface exploration work and a drill program on the property in 2013. Orta Truva is owned by Pilot Gold (40%) and Teck Resources Limited's ("Teck") Turkish subsidiary, Teck Madencilik Sanayi Ticaret A.S. (60%).
"Pilot Gold and partner Teck continue to consolidate a dominant land position in the Biga," stated Matt Lennox-King, President and CEO, Pilot Gold. "The acquisition of Karaayi adds 1,956 hectares of highly prospective and strategically important land to the TV Tower project. We are very excited to begin exploration on Karaayi, with a focus on extending the footprint of known mineralized zones from TV Tower's Kayali target."
The Karaayi tenure contains some of the strongest and most extensive gold-in-soil anomalies in the TV Tower district. Drilling at Karaayi by previous operators, including Chesser, has intersected near-surface, oxidized, high-sulphidation style gold mineralization, which is on strike to the west of the known oxidized gold mineralized zone at Kayali. In addition, Chesser's exploration to date has identified the presence of supergene copper and porphyry style copper-gold mineralization on the Karaayi property. There are 96 permitted drill sites in the northern portion of the tenure, allowing for immediate access for drilling.
Pilot Gold is project operator at TV Tower and can increase its interest in the project to 60% through sole funding of exploration over a three-year period. (See press release dated June 21, 2012 for full details of the TV Tower project agreement terms.) Expenditures related to the acquisition of Karaayi will count as Expenditures towards Pilot Gold's obligations under the TV Tower Agreement. With these expenditures, Pilot Gold expects to surpass the second milestone Expenditure requirement toward earning an additional 20% interest in the TV Tower project.
For a map showing Karaayi and TV Tower, please click here:
About TV Tower
The TV Tower project is a joint venture between Pilot Gold (40%) and a Turkish subsidiary of Teck (60%). Located on the Biga Peninsula in northwest Turkey, TV Tower encompasses 71 square kilometres. It contains a large number of targets ranging from high- and low-sulphidation epithermal gold-silver to porphyry gold-copper. The project has an extensive road network and targets to date all lie on land administered by Turkey's Ministry of Forestry. It is located immediately west of the Kirazli gold project (Alamos Gold) and approximately 10 kilometres northwest of the Halilaga copper-gold project (Teck/Pilot Gold). Upon closing, the Karaayi property will be included in the TV Tower property, and will be owned proportionate to the interest of Pilot Gold and Teck.
Pilot Gold has budgeted for 30,000 metres of drilling at TV Tower in 2013, including a second-year 15,000-metre drill program launched at the KCD target on March 23, 2013. Pilot Gold also plans to drill 7,500 metres at Kayali and other high priority targets. At Karaayi, a surface mapping and sampling program has been initiated with first pass drilling expected later in the year.
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 approved the technical information contained herein. Dr. Smith is responsible for compiling the technical information contained in this press release but she has not verified all the assay data generated by Chesser as previous project operator at Karaayi and has not necessarily had access to individual assay certificates. However, Chesser has given her no reason to doubt their authenticity.
TV Tower and Karaayi are early stage exploration projects; neither contain any mineral resource estimates as defined by NI 43-101. The potential quantities and grades disclosed herein are conceptual in nature and there has been insufficient exploration to define a mineral resource for the targets disclosed herein. It is uncertain if further exploration will result in these targets yielding a mineral resource.
ABOUT PILOT GOLD
Pilot Gold is a well-funded gold exploration company led by a proven technical team that continues to discover and define high-quality assets featuring strong grades, meaningful size and mining-friendly addresses. Our three key assets include interests in the TV Tower and Halilaga projects in Turkey, and the Kinsley Mountain project in Nevada, each of which has the ability 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:
Patrick Reid, VP, Corporate Affairs
Phone: 604-632-4677 or Toll Free 1-877-632-4677
Ian Noble, Director, Corporate Communications
Further information is available in the technical report entitled "Updated Technical Report on the TV Tower Exploration Property, Çanakkale, Western Turkey", effective July 15, 2012 and dated August 3, 2012, prepared by Paul Gribble, B.Sc., C.Eng., FIMMM, UK Manager, Geology of Tetra Tech WEI Inc., under Pilot Gold's Issuer Profile on SEDAR (www.sedar.com).
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 timing of exploration and development plans at the Company's mineral projects. 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, availability of equipment, accuracy of any mineral resources and mineral reserves, successful resolution of disputes 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, including, but not limited to, statements that address reserve or resource potential, potential quantity and/or grade of minerals, potential size of a mineralized zone, potential expansion of mineralization, the timing and results of future resource estimates, proposed timing of exploration and development plans at the Company's mineral projects, successful closing of the transaction to acquire the Karaayi property, and the estimation of mineral reserves and resources involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of Pilot Gold to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information.
Such factors include, among others, risks related to the interpretation of results at certain of our exploration properties, reliance on technical information provided by our joint venture partners or other third parties as related to any of our exploration properties; changes in project parameters as plans continue to be refined; successfully completing the earn-in on the TV Tower project, including the ability to incur the minimum annual Expenditure Requirements and future issuance of common shares as consideration to complete the earn-in agreement; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; current and proposed exploration and development; 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; uses of funds in general including future capital expenditures, exploration expenditures and other expenses for specific operations; the timing and success of exploration activities generally; achievement of identified tangible project milestones at TV Tower; delays in permitting; satisfaction of Turkish requirements relating to the periodic submissions of Environmental Impact Assessments; possible claims against the Company or its joint venture partners; 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 for the year ended December 31, 2012, dated March 27, 2013 (the "AIF") 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. Accordingly, readers should not place undue reliance on forward-looking information. Further details relating to Pilot Gold are also available in our AIF, available under Pilot Gold's SEDAR profile at www.sedar.com.