Rye Patch Gold Corp is pleased to announce an exploration update on the 100% controlled Lincoln Hill project located in Pershing County, Nevada. Exploration activities continue at Lincoln Hill with new surface rock-chip sampling results from the Independence Hill and surrounding targets zones
Rye Patch Gold is a Tier 1, Nevada-focused and discovery-driven company seeking to build a sizeable inventory of gold and silver resource assets in the mining friendly state of Nevada, USA. The Company’s seasoned management team is engaged in the acquisition, exploration, and development of quality resource-based gold and silver projects. Rye Patch Gold is developing gold and silver resources along the emerging Oreana trend, located in west-central Nevada, and is exploring 66 square kilometres along the Cortez trend near Barrick’s two new gold discoveries. The Company has established gold and silver resource milestones and time frames in order to build a premier resource development company. For more information about Rye Patch Gold, please visit our website.
Building Two Trend-Scale Opportunities
1) Oreana Gold and Silver Trend
2) Cortez Gold Trend
Joe Kajszo
Chairman
Mr. Kajszo is co-founder of Rye Patch Gold. A geologist by training, Mr. Kajszo co-founded and also served as President and Director of Nevada Pacific Gold Inc. from 1997 to 2004. Prior to that Mr. Kajszo served as Vice President - Exploration for Robert Friedland's Ivanhoe Capital Corp. Ivanhoe's umbrella included a number of public companies such as Venezuela Goldfields (KM 88 in Venezuela), First Dynasty Gold (Fort Knox Mine in Alaska), Diamond Field Resources (Voiseys Bay massive sulfide deposit in Labrador), and African Minerals Corp (Platreef PGM-Cobalt deposit in South Africa). Mr. Kajszo has 26 years of experience in the mining and mineral exploration industry worldwide including direct involvement in projects in Africa, China and North and South America.
William C. (Bill) Howald
President, Chief Executive Officer and Director
Mr. Howald is a co-founder of Rye Patch Gold. Prior to joining Rye Patch, he was General Manager of Exploration, United States and Latin America, for Placer Dome Inc. During his tenure at Placer Dome, Mr. Howald was an integral part of the teams that delivered over 80Mozs of gold resources to the Placer portfolio. A number of these resources are now being mined; these include Pipeline, Turquoise Ridge, Cortez Hills and Bald Mountain Mines in Nevada, and Puren in Chile. Others, such as Pueblo Viejo in the Dominican Republic, and Donlin Creek in Alaska are in the feasibility stage and are heading for production decisions. Mr. Howald has 25 years in the international gold exploration and mining industry gained primarily in Nevada, Mexico, and Central and South America.
Alnesh Mohan, CA, CPA (lll.)
Chief Financial Officer
Mr. Mohan is a Chartered Accountant and a partner at Quantum Advisory Partners LLP ("Quantum"). Quantum is a chartered accounting firm specializing in providing accounting and financial reporting support to junior resource companies. Mr. Mohan has over 16 years of accounting, auditing and tax experience providing advisory services to a wide array of clients. Prior to joining Quantum, Mr. Mohan spent over a decade working within the Big 4 public accounting firms. Most recently he spent four years with KPMG LLP in Vancouver as a tax manager providing corporate and personal tax consulting and compliance services to clients both in Canada and the United States.
Charles C. Russell
Director
Mr. Russell has a Fellow Institution of Materials, Mining and Metallurgy (FIMMM) from Camborne School of Mines in Cornwall, UK. Mr. Russell has been retired from June 1996 to present. He is also an independent Director of Golden Reign Resources Ltd. Mr. Russell has 50 years of experience in the mining industry including VP Mining & Technology for Ivanhoe Capital Corp., General Manager for Ashanti Gold Fields in Ghana and General Manager for National Iron Ore Co. in Liberia.
Jonathan Challis
Director
Mr Challis has an honours degree in Mineral Exploitation from University College, Cardiff and an MBA degree from Cranfield University. Within the last five years Mr. Challis has served as President and Director of Shore Gold Inc. (diamond exploration) from 1999 to December 2003; President, COO and Director of Cornerstone Capital Resources Inc. (gold exploration) from January 2004 to January 2005; President and Director of Solex Resources Corporation (uranium exploration) from January 2004 to May 2010 company which has since been renamed as Southern Andes Energy Inc. in which he remains a Director. Mr. Challlis is currently CEO and Director of SEAM Ltd., a private UK based mineral exploration company; a Director of Peregrine Diamonds Ltd., Peregrine Metals Ltd. and Sunward Resources Ltd. Mr. Challlis is a mining engineer with over 30 years experience in the operation, management, financing and analysis of mining projects around the world.
Bernard Poznanski
Corporate Secretary
Mr. Poznanski has been a partner of Koffman Kalef LLP, Business Lawyers, since its inception in April 1993. Mr. Poznanski has acted as counsel for a wide variety of companies listed on the TSX, the former Canadian Venture Exchange (now the TSX Venture Exchange), the American Stock Exchange and NASDAQ. His practice areas are focused on advising mining and technology companies in connection with corporate finance and corporate/commercial matters and international projects.
OREANA TREND
The Company continues to build a sizeable land position along the Oreana trend since it arrived on the trend in 2006. To date, the Oreana trend and the Rochester District have been underexplored. In light of the rate and quality of new discoveries and resource quantification completed by Rye Patch in a short period of time, this demonstrates the attractiveness of the mineral claims for further exploration and development
WILCO PROJECT
Figure 1: Drilling Section Line Discovery, July 2007
Located 160 kilometres north east of Reno along Interstate 80, the advanced-stage Wilco Project currently holds a gold and gold equivalent resource of 788,000 ounces measured and indicated plus 2,084,315 ounces inferred. Rye Patch has completed more than 30,000 metres of reverse circulation drilling and 6000 metres of core drilling at Wilco. The 2011 drill program focused on building on the high-grade gold drill results achieved from the 2010 drilling program. The successful program is now being incorporated in to a new NI43-101 resource estimate that will be available in Q1 of 2012. Prior to the high-grade discovery area, drilling at Wilco has focused on the Section Line and Colado Zones, where a NI 43-101 resource was announced in April 2009.
The Wilco project’s rich history dates back more than 100 years and includes heap leach extraction by Western States in the early 1990s. Numerous significant gold discoveries have occurred since 1905, and drilling by majors such as Freeport Exploration, Santa Fe and Newmont Mining has defined a number of targets never fully tested.
Rye Patch has earned a 100% interest in the Wilco project from Newmont Mining by spending $3 million in exploration and development. This milestone was achieved one year early. Newmont can also elect to regain up to a 70% interest by spending an additional $20 million in development work.
The 2010 and 2011 drill programs focused on potential high-grade gold feeder systems within the North Basin target. The last drillhole from the 2008 campaign, WR-087, returned the thickest and highest grade gold zone on the property - 38.1m @ 2.61 g/t Au.
The interpreted intersection zone between the Section Line antiform, and the North
Basin high-grade zone returned 124.9 metres grading 0.606 g/t gold. Drilling has extended the North Basin high-grade zone to 800 metres along strike. WRC-017 and WRC-018 extend a 12 to 15 metre thick upper oxide zone starting at 100 metres down the drillhole to the northwest. Core drilling has improved the geologic model and provide systematics for predicting the gold zones.
In addition to gold resources and high-grade targets at Section Line and North Basin, the Wilco property contains several untested targets. The Woolsey pediment target located on the northern portion of the property has significant upside potential. The target lies adjacent to a hill that is completely altered and mineralized. The surface gold rock-chip and soil data at the edge of the pediment show anomalous gold values. Rye Patch has identified the main gold zone has not been drill tested at the Woolsey pediment target.
Rochester Project
Rye Patch Gold through its wholly owned subsidiary Rye Patch Gold US Inc. announced it acquired land and mineral rights by staking open, locatable public lands which contain gold and silver resources in the Rochester Mining District, Pershing County, Nevada. Through a review of the United States Bureau of Land Management (“BLM”) mining claim maintenance fee records, Rye Patch Gold identified open locatable public lands and staked claims covering portions of the Rochester and Nevada Packard gold and silver mines and their resource inventory – 402 unpatented mining claims covering 30.3 square kilometres.
Figure 2: Drilling at Northwest Rochester, February 2012
Under United States law, CDE’s failure to pay the annual mining claim maintenance fees caused CDE’s 541 unpatented mining claims to be forfeited and void as a matter of law. Ownership of and title to the minerals on the federal public lands reverted to the United States government, and any citizen or U.S. company had the right to acquire mineral title through staking unpatented lode mining claims on the open federal lands. Rye Patch identified the open ground and beginning in October 2011 and November 2011 located 402 unpatented lode mining claims which it filed and recorded with the BLM and Pershing County, Nevada.
Since November 2011, Rye Patch has completed considerable work on the Rochester project – LH Claims. The Company completed detailed mapping, structural analysis, rock-chip sampling, soil sampling, a 75 line-kilometre ground-magnetic geophysical survey, and has commenced a 10,000 metre (30,000 ft) reverse circulation drilling campaign on its discoveries identified on the LH claims.
The Rochester project has numerous targets. Rye Patch has prioritized five areas - Northwest Rochester, Mystic, Limerick Basin, Independence Hill, and Black Fault. Drilling is progressing in Limerick Basin, Northwest Rochester and Mystic. Permitting is on going at Independence Hill and the Black Ridge Fault.
Rye Patch Gold controls over 100 square kilometres (40 sq. miles) along the Oreana trend. The Rochester Property - LH Claims - covers 30.3 square kilometres (7,493.2 acres). The District Court has enjoined the Company from conducting exploration activities on approximately 7.4 square kilometres (1,839.3 acres) covering the active open pit, mine dumps and leach pads in the immediate Rochester Mine area. It is the Company’s position that all the LH claims are valid senior unpatented mining claims, including those claims within the court-ordered enjoined area. Geologic assessment, and drilling confirm discoveries on the LH claims and the land area which covers up to 20% of Rochester’s published proven and probable silver and gold reserve along with a significant portion of the published silver and gold resource based on Coeur d’Alene Mine’s December 5, 2011 news release. The trial is scheduled for November 2012.
LINCOLN HILL PROJECT
Located just 16 kilometres east of Rye Patch’s Wilco Project, the 100%-owned Lincoln Hill and adjacent Gold Ridge properties securely position Rye Patch along the Oreana gold trend and Rochester mining district of Western Nevada. The area has supported active exploration for nearly 150 years, and underground mining in the early 1900s reportedly averaged 7.5 ounces of gold per ton. A resource estimate was completed in the Spring 2010.
Analysis of data by Rye Patch indicates the project contains potential for a bulk-tonnage gold/silver deposit similar to the nearby and adjacent Rochester Silver Mine and Spring Valley deposit. The Rochester district has produced 4.5 million ounces of gold and 130 million ounces of silver.
The Lincoln Hill project was acquired in 2007, by a combination of staking unpatented lode mining claims and completing lease agreements with two separate local prospectors. From the 2011 program, it was determined that in-fill drilling on the Lincoln Hill resource connects the Main zone with the Shaft zone along a near-surface, stratabound gold and silver zone. The drilling may add additional resource ounces to the Lincoln Hill resource.
Step-out drilling on the Lincoln Hill resource shows expansion potential down dip and to the northeast. Four drillholes define an area measuring 250 metres by 70 metres with gold and gold equivalent grades reaching 5.87 g/t Aueq over 4.6m.
At the Jefferson zone, exploration drilling defines an area measuring 300 metres by 80 metres where drillhole LR-061 cut three metres grading 0.25 g/t Au and 509.5 g/t Ag for a gold equivalent grade of 10.44 g/t Aueq.
Figure 3: Lincoln Hill Drilling, September 2011
The 2011 drill campaign completed 8,288 metres in 40 reverse circulation (RC) drillholes, and 1,258 metres in 5 core holes located in the Central and North Jefferson zone, Washington target, Western Dyke target and in-fill drilling within the Lincoln Hill resource. The drilling program was designed to test new targets, expand the existing resource, and in-fill drilling to increase the confidence and upgrade the Lincoln Hill resource.
Three drillholes were completed in the Washington zone, ten drillholes in Central Jefferson zone, ten drillholes in the North Jefferson zone, two drillholes in the Western Dyke target, and twenty in-fill drillholes in the Lincoln Hill resource. A new NI 43101 resource is in the works for Lincoln Hill for the first half of 2012, and a summer drill program is in the planning stages.
GOLDRIDGE PROPERTY
Figure 4:Night drilling at Gold Ridge, November 2011
The Gold Ridge property is 100% owned project is located approximately 1.6 kilometres west of Lincoln Hill and was acquired in 2007 by staking unpatented lode mining claims. The 2011 drill campaign completed 2,462 metres in 12 reverse circulation drillholes centered on the Silver Ridge target. The drill program tested two geologic targets along a 1.2 kilometre long mineralized zone. The first geologic target drilled is a low-angle thrust fault zone with quartz breccia and veins containing gold and silver mineralization. The second target consists of deformed jasperoid layers (silicified rock) in the hangingwall of the main north-south oriented thrust structure. The main jasperoid body is stratabound and is 10- to 30-metres in true thickness. The jasperoids have significant strike length along the limbs of the anticline with oxide potential that remains untested. The low-angle fault lies beneath the jasperoid zones at a depth of approximately 175 metres. Additional drilling in 2012 is required to test the low-angle fault to the east where the zone should daylight. And additional drilling to east will test the up-dip portion of the low angle fault zones at shallower depths.
JESSUP PROPERTY
Located 100 kilometers northeast of Reno, the 100%-owned Jessup property holds excellent potential for both near-surface oxide bulk tonnage and high-grade gold/silver underground deposits. The updated 2009 NI 43-101 resource calculation showed 300,000 ounces of gold (measured and indicated) and 77,000 ounces of gold inferred. Silver resources are 5.09 million ounces (measured and indicated). The inferred silver resource is 1.146 million ounces. Both gold and silver mineralization remains open both down dip and along strike. The successful completion of the 2010 drilling campaign identified a new mineralized at San Jacinto and a total of 12 drillholes (2,476 metres) penetrated gold and silver bearing breccias in the North Jessup deposit. The drill program targeted and confirmed thicker grade gold and silver grades. Based on these new results, additional follow up is planned.
CORTEZ TREND
The Cortez trend is a segment of the greater Battle Mountain-Eureka (“BM-E”) trend that is parallel and west of the famous Carlin trend in east-central Nevada. The Cortez trend is a well endowed portion of the trend with over 40-million ounces of gold discovered and mined since 1991. The main deposits are Pipeline, Cortez Hills and the newly announced Red Hill and Goldrush deposits. Rye Patch Gold controls over 65 sq. kilometres along the trend immediately south and adjacent to Barrick Gold’s land holding in the trend and within three kilometres of the Goldrush discovery.
GARDEN GATE PASS
Located 12 kilometres (7 miles) south-southeast of Barrick Gold’s Cortez Hills mine the Garden Gate Pass project consists of 153 unpatented lode claims acquired from a local prospecting company, Pyramid Lake LLC on the Cortez trend, one of Nevada’s most prolific gold trends. Rye Patch controls 100% of the property subject to annual advance royalty payments and a 2% retained net smelter return (NSR).
Geographically, Garden Gate Pass project is surrounded by gold mines including Barrick Gold’s Cortez Hills deposit located 12 kilometres to the north-northwest, and their Goldrush and Red Hills discoveries located to the north - roughly 4 kilometres and 7 kilometres respectively. Barrick Gold has connected the Red Hill and Goldrush deposits and doubled the gold resource from their September 6, 2011 announcement. The gold trend has 8 kilometres of gold deposits starting from the Horse Canyon mine to the ET Blue gold deposit and remains open toward the Garden Gate Pass project. US Gold’s Tonkin Springs mine is a mere 15 kilometres to the south.
Rye Patch’s 2011 drilling campaign intersected lower plate lithologies in 4 of 6 drillholes, and encountered thick zones of Carlin-style alteration with geochemically anomalous gold and pathfinder elements. Using the data points generated from the 2011 drill program, Rye Patch is refining its drill targets and plans to commence drilling in May 2012 pending drill rig availability.
On February 16, 2012, Barrick announced a new resource on their Red Hill and Goldrush complex of 1.3Mozs gold in the indicated category, and 5.7Mozs gold in the inferred category. The new resource doubles the resource previously announced on September 6, 2011, and shows the immense potential of the district. Barrick’s drilling along the north-south trend has connected the two discoveries and indicates the gold zone is open in multiple directions including toward the Garden Gate Pass project.
Figure 5: Drilling on Garden Gate Pass, October 2011
PATTY PROJECT
The Patty project consists of 616 unpatented lode claims covering 53.1 square kilometres (13,120 acres) and is located immediately south of Rye Patch’s 100% owned Garden Gate Pass project; 10 kilometres south-southeast of Barrick Gold’s recently announced Red Hill and Goldrush discoveries; and east and adjacent to US Gold’s Tonkin Springs project along the western margin of the Northern Nevada Rift (NNR). Geologically, the project straddles the same geologic environment as Barrick’s new gold discoveries at Red Hill and Goldrush. The project has a non-NI43-101 compliant resource inventory plus past drilling with gold in three of the five target areas. With this acquisition, Rye Patch now controls more than 65 square kilometres along the prolific Cortez gold trend. The target areas are the Patty Resource, Patty North, Western Rift, West Geyser, South Pediment, and Indian Creek. Western Rift target lies along the western margin of the NNR within a similar geologic environment as Barrick’s new gold discoveries. In 2005, Placer Dome drilled gold in Devonian carbonate rocks along the western margin of the NNR. Drillhole PIR05-010 intersected 102 metres grading 0.32 g/t gold including 1.5 metres grading 4.16 g/t gold. The gold intercept in PIR05-010 may have new significant meaning with the discovery of Barrick’s Red Hill and Goldrush deposits.
Rye Patch Gold entered into a joint venture agreement with Barrick Gold US, US Gold Corp and Chapleau Resources, located in Eureka County, Nevada. Under the terms of the agreement, Rye Patch has the right to earn a 60% undivided interest in the Patty Project by spending US$5 million over a five-year period, of which the first year’s expenditure of US$500,000 is committed. As part of the commitment, Rye Patch will reimburse the Patty Joint Venture for $93,120 of lease payments and one half of federal claim rental fees paid by the Patty Joint Venture in 2011. Once Rye Patch completes its earn in, Rye Patch will control 60% undivided interest with Barrick Gold, US Gold and Chapleau Resources having 24%, 12%, and 4% respectively.
Upon completion of the earn-in amount by Rye Patch, the Patty Joint Venture will have the right to back in to a 60% interest by expending US$15 million over a five year period, of which amount one-third will be paid in cash to Rye Patch. The Patty Joint Venture must exercise its back-in right within 90 days of Rye Patch completing its earn in. If the Patty Joint Venture completes its back in, Rye Patch will control 40% undivided interest with Barrick Gold, US Gold and Chapleau Resources having 36%, 18%, and 6% respectively.
Upon completion of the back in, Rye Patch’s remaining 40% will be carried until production commences on the property. The Patty joint venture may recover such carried costs, plus interest at the prime rate plus 2%, from 80% of Rye Patch’s share of production from the property. In addition, the Patty Joint Venture is required to spend a minimum of US$500,000 annually on the property until the commencement of production.
The core Damale claims retain a 3% NSR and an annual 1,500-metre (5,000-foot) drill commitment; however, for 2012, there is a 3,300-metre (10,800-foot) drill commitment that is required to be completed before December 31, 2012.
Oreana Trend
110 sq. kms owned & controlled
Wilco
• Large bulk-tonnage, near surface gold
and silver resource
• Resource expansion on-going with
additional target delineation programs
• Earned 100% interest from Newmont
by spending $3M in exploration and
development subject to Newmont
back-in
Lincoln Hill
• Bulk-tonnage, near-surface resource with
high-grade gold and silver potential
• Rochester mining district known for
historical production of 4.5Moz Au,
130Moz Ag
• Silver and gold grade similar and
exceeding the grades mined at the nearby
Rochester Silver Mine
Goldridge
• Located between Wilco and Lincoln
Hill projects
• 5 targets defined by surface exploration
• Exploration drilling shows thick gold and
silver zones on the property
Rochester
• 30 sq. kms
• 5 discovery areas
• Excellent surface gold and silver
values
• Drilling program in progress
Jessup
• Near-surface, bulk tonnage oxide
deposit with high-grade gold and silver
• Resource open to north and south
Cortez Trend
66 sq. kms owned & controlled
Garden Gate Pass
• On Battle Mountain-Eureka Gold Trend,
immediately adjacent to Barrick’s Cortez
property
• Geophysical surveys show two target
zones with similar features seen at
Barrick’s Cortez Hills and Red Hill and
Goldrush gold deposits
• Big upside potential
Patty
• 55 sq. kms
• 6 target areas
• Drill holes with 102M of 0.32 g/t Au
• Ready for follow-up drill program
Nevada Focus: We’re focused on Nevada because of management’s considerable knowledge of the region and the state’s key position in world gold output. Nevada currently produces 78% of U.S. gold and 8% world goldw. The state’s gold production has declined however, from over 8 million ounces in 1998 to slightly over 5 million ounces in 2010. As a result, major mining companies operating in Nevada will seek to replace their resources and reserves. Rye Patch Gold will be in an excellent position to provide the shortfall.
As of January 2012
Issued and Out: 138 million
Fully Diluted: 144 million
Cash in the bank: $7.3 million
