Mr. Walt Coles Jr. reports
SKEENA INTERSECTS 10.09 G/T AUEQ OVER 45 METRES AT ESKAY CREEK
Skeena Resources Ltd. has provided additional gold-silver assays for six holes from the continuing phase I surface drilling program at the Eskay Creek project located in the Golden Triangle of British Columbia. The multifaceted phase I program is being performed in the historically drill defined 21A, 21C and 22 zones. Reference images are presented on the company's website.
Eskay Creek phase I drilling -- recent highlights:
9.07 grams per tonne gold, 76 g/t silver and 10.09 g/t gold equivalent over 45.00 metres (SK-18-012), including 13.06 g/t Au, 84 g/t Ag and 14.18 g/t AuEq over 27.77 m;5.39 g/t Au, 139 g/t Ag and 7.24 g/t AuEq over 28.30 m (SK-18-014),including 8.23 g/t Au, 185 g/t Ag and 10.69 g/t AuEq over 12.45 m;4.16 g/t Au, 204 g/t Ag and 6.88 g/t AuEq over 43.50 m (SK-18-017), including 3.53 g/t Au, 502 g/t Ag and 10.23 g/t AuEq over 15.00 m.
Gold equivalent (AuEq) is calculated via the formula: Au (g/t) plus (Ag (g/t) divided by 75). Reported core lengths represent 80 to 100 per cent of true widths and are supported by well-defined mineralization geometries derived from historical drilling. Length-weighted AuEq composites were constrained by geological considerations as well as a calculated 1.0 g/t AuEq assay grade cut-off assuming reasonable prospects for economic extraction via open-pit mining methods. Grade capping of individual assays has not been applied to the Au and Ag assays informing the length-weighted AuEq composites. Processing recoveries have not been applied to the AuEq calculation and are disclosed at 100 per cent due to a lack of supporting information. Samples below detection limit were nulled to a value of zero.
Phase I drilling discussion
The phase I drilling program at Eskay Creek continues to demonstrate the excellent grade and geological continuity of the 21A zone. The program is designed to infill and upgrade areas of the 21A zone with low drill density to sufficient drill spacing to allow for future economic analyses and also to collect fresh material for an upcoming metallurgical testing program.
Mineralization intersected on Section 10,000N (see images available on the company's website) is largely hosted in the footwall rhyolites with minor mineralization hosted in the contact mudstone as illustrated by an intercept of 9.07 g/t Au, 76 g/t Ag and 10.09 g/t AuEq over 45 m (drill hole SK-18-012) including a higher-grade interval grading 13.06 g/t Au, 84 g/t Ag and 14.18 g/t AuEq over 27.77 m. On the same section drilling intersected 5.39 g/t Au, 139 g/t Ag and 7.24 g/t AuEq over 28.3 m including 8.23 g/t Au, 185 g/t Ag and 10.69 g/t AuEq over 12.45 m (drill hole SK-18-014) located 45 m down-dip of SK-18-012. On Section 9960N drilling intercepted 4.16 g/t Au, 204 g/t Ag and 6.88 g/t AuEq over 43.5 m hosted entirely within the footwall rhyolite facies (drill hole SK-18-017).
21A and 21B zones -- analogous mineralization styles
The 21B zone is geologically and geochemically equivalent to the 21A zone and accounted for the bulk of mineralization historically mined at Eskay Creek. The 21B zone occurs as a tabular, stratiform, fault-bounded body characterized by well-bedded, reworked sulphides and sulphosalts interbedded with unmineralized, carbonaceous argillite (mudstone). In addition to the extremely high precious metal grades Eskay Creek as a whole (particularly in the 21A and 21B zones) is distinguished from conventional VMS (volcanogenic massive sulphide) deposits by the association with elements of the epithermal suite (antimony-mercury plus or minus arsenic). Elevated concentrations of Sb-Hg-As in the 21A and 21B zones are not evenly distributed throughout the zones but rather occur as isolated clusters due to later-stage localized hydrothermal overprinting.
Although the bulk of the mined material was hosted in the contact mudstone, significant unmined mineralization exists in proximal feeder structures in the footwall rhyolites (21C and Pumphouse zones). These zones differ geochemically from the 21A and 21B zones in that they contain low levels of Sb-Hg-As as compared with those hosted in the contact mudstone.
21B zone historical reconciliation
Underground mining at Eskay Creek was performed using the drift and fill mining method with run-of-mine material either milled at site to generate a concentrate or as direct shipping ore (DSO), to smelters. Due to the elevated concentrations of Sb-Hg-As in the 21B zone, smelter penalties were often prevented via blending with slightly less deleterious material thereby diluting the penalty elements while maintaining a profitable head grade.
Based upon historical internal technical reports from the Eskay Creek mine, the parameters for determining reserves in 2006 were based upon a gold price of $475 (U.S.) per ounce, a silver price of $8.50 (U.S.) per ounce and a copper price of $1.50 (U.S.) per pound. The nominal price of gold in 2006 averaged $603 (U.S.) per ounce and the inflation adjusted price averaged $738 (U.S.) per ounce, which are significantly lower commodity prices than today. The determination of whether material was milled on site versus shipped directly to an offsite smelter was based on mercury concentrations less than 200 parts per million and antimony concentrations less than 1 per cent for on-site milling and greater than 200 ppm mercury or greater than 1 per cent antimony for smelter DSO. The same 2006 mill performance report indicates metallurgical recoveries from on-site milling of the 21B zone at 84 per cent for gold and 96 per cent for silver.
Despite the substantial precious metal grades and base metal credits of the 21A zone, in the opinion of the company, the low commodity prices combined with smelter penalties and necessary cut-off grade deemed the 21A zone historically uneconomic. As well, antimony was treated as a penalty element and now has the potential to offer significant byproduct credits.
About Eskay Creek
In December, 2017, Skeena secured an option to acquire 100-per-cent interest in the Eskay Creek property. Discovered in the Golden Triangle in 1988, the former Eskay Creek mine produced approximately 3.3 million ounces of gold and 160 million ounces of silver at average grades of 45 g/t gold and 2,224 g/t silver. Eskay Creek was once the world's highest-grade gold mine and fifth-largest silver mine by volume.
A precious- and base-metal-rich volcanogenic massive sulphide (VMS) deposit, Eskay-style mineralization has been the focus of considerable exploration activity in the Golden Triangle dating back to 1932. Exploration programs in 1988 led to the discovery of the 21A and 21B zones, followed by underground development of the 21B zone starting in 1990 with the official opening of the Eskay Creek mine in 1994. Over the 14-year life of the mine, approximately 2.2 million tonnes of ore were mined with cut-off grades ranging from 12 to 15 g/t AuEq for mill ore and 30 g/t AuEq for direct shipping smelter ore.
Eskay is endowed with excellent infrastructure including all-weather road access and proximity to the new 287-kilovolt Northwest Transmission Line. The property consists of eight mineral leases, two surface leases and several unpatented mining claims totalling 6,151 hectares.
Eskay is in the traditional territory of the Tahltan First Nation. Skeena has a positive working relationship with the Tahltan central government (TCG) and has signed exploration and communication agreements with the TCG that cover the company's other projects in Tahltan territory (see news releases dated Sept. 25, 2017, and Jan. 24, 2017).
About Skeena Resources Ltd.
Skeena Resources is a junior Canadian mining exploration company focused on developing prospective precious and base metal properties in the Golden Triangle of northwest British Columbia, Canada. The company's primary activities are the exploration and development of the past-producing Snip mine and the recently optioned Eskay Creek mine, both acquired from Barrick. In addition, the company has completed a preliminary economic assessment on the GJ copper-gold porphyry project.
Qualified persons
Exploration activities at the Eskay Creek project are administered on site by the company's exploration managers, Colin Russell, PGeo, and Adrian Newton, PGeo. In accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects, Paul Geddes, PGeo, vice-president of exploration and resource development, is the qualified person for the company and has prepared, validated and approved the technical and scientific content of this news release. The company strictly adheres to CIM Best Practices Guidelines in conducting, documenting and reporting its exploration activities on its exploration projects.
Quality assurance -- quality control
Once received from the drill and processed, all drill core samples are sawn in half, labelled and bagged. The remaining drill core is subsequently securely stored on site. Numbered security tags are applied to lab shipments for chain of custody requirements. The company inserts quality control (QC) samples at regular intervals in the sample stream, including blanks and reference materials with all sample shipments to monitor laboratory performance. The QA/QC program was designed and approved by Lynda Bloom, PGeo, of Analytical Solutions Ltd., and is overseen by the company's qualified person, Mr. Geddes.
Drill core samples are submitted to ALS Geochemistry's analytical facility in North Vancouver, B.C., for preparation and analysis. The ALS facility is accredited to the ISO/IEC 17025 standard for gold assays and all analytical methods include quality control materials at set frequencies with established data acceptance criteria. The entire sample is crushed and one kilogram is pulverized. Analysis for gold is by 50-gram fire assay fusion with atomic absorption (AAS) finish with a lower limit of 0.01 ppm and upper limit of 100 ppm. Samples with gold assays greater than 100 ppm are reanalyzed using a 50 g fire assay fusion with gravimetric finish. Analysis for silver is by 50 g fire assay fusion with gravimetric finish with a lower limit of five ppm and upper limit of 10,000 ppm. Samples with silver assays greater than 10,000ppm are re-analyzed using a gravimetric silver concentrate method. A selected number of samples are also analyzed using a 48-multielemental geochemical package by a four-acid digestion, followed by inductively coupled plasma atomic emission spectroscopy (ICP-AES) and inductively coupled plasma mass spectroscopy (ICP-MS), and also for mercury using an aqua regia digest with inductively coupled plasma atomic emission spectroscopy (ICP-AES) finish. Samples with sulphur reporting greater than 10 per cent from the multielement analysis are reanalyzed for total sulphur by Leco furnace and infrared spectroscopy.
ESKAY CREEK PROJECT PHASE I 21A ZONE LENGTH WEIGHTED DRILL HOLE GOLD and SILVER COMPOSITESCoreHole ID From (m)To (m) length (m) Au (g/t) Ag (g/t) AuEq (g/t)SK-18-012 73.50118.50 45.00 9.077610.09Including 73.50101.27 27.7713.068414.18Including 73.50 75.001.5012.352012.62and 75.00 75.690.6910.80 910.92and 76.50 77.501.0020.601420.79and 77.50 78.501.0014.803315.24and 78.50 80.001.5020.807121.75and 80.00 81.001.0030.20 10831.64and 81.00 82.501.5010.95 25414.34and 82.50 84.001.5011.95 56319.46and 84.00 85.501.5023.40 24726.69and 85.50 87.001.5018.808319.91and 87.00 88.501.5014.803615.28and 88.50 89.050.5517.301717.53and 89.05 89.600.5523.102023.37and 89.60 91.001.4013.704314.27and 99.00100.001.0013.55 313.58and100.00101.271.2710.65 710.74SK-18-013 74.00100.50 26.50 2.8963 3.73SK-18-014 74.00102.30 28.30 5.39 139 7.24Including 85.55 98.00 12.45 8.23 18510.69Including 86.30 87.501.20 8.20 51815.11and 87.50 89.001.50 8.4214 8.61and 89.00 89.600.60 8.01 74117.89and 89.60 91.001.4015.15 21518.02and 95.00 96.001.00 5.89 239 9.08and 96.00 96.500.50 9.07 23212.16and 96.50 98.001.50 9.24 23212.33SK-18-015 75.60108.50 32.90 3.7495 5.00Including 75.60 77.001.4011.151511.35and 86.00 87.501.50 5.50 38710.66and 87.50 89.001.50 3.02 423 8.66SK-18-016 60.92 76.00 15.08 2.8417 3.06SK-18-016 88.00107.00 19.00 1.3019 1.55SK-18-017 61.50105.00 43.50 4.16 204 6.88Including 63.00 78.00 15.00 3.53 50210.23Including 64.50 66.001.50 2.34 2,60037.01and 73.50 75.001.50 8.32 1,13523.45Gold equivalent (AuEq) calculated via the formula: Au (g/t) plus (Ag (g/t) divided by 75). Reported core lengths represent 80 to 100 per cent of true widths and are supported by well-defined mineralization geometries derived from historical drilling. Length-weighted AuEq composites were constrained by geological considerations as well as a calculated 1.0 g/t AuEq assay grade cut-off assuming reasonable prospects for economic extraction via open-pit mining methods. Grade capping of individual assays has not been applied to the Au and Ag assays informing the length-weighted AuEq composites. Processing recoveries have not been applied to the AuEq calculation and are disclosed at 100 per cent due to a lack of supporting information. Samples below detection limit were nulled to a value of zero.
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