Nevada Exploration Enters Strategic Drilling Agreement with Drill NV
October 5, 2021
Nevada Exploration Inc. (“NGE” or the “Company”) (TSX-V:NGE; OTCQB:NVDEF) is pleased to announce that it has entered into a strategic drilling partnership with Nevada-based Drill NV Inc. (the “Agreement”) to provide up to 31,000 feet of core drilling at NGE’s South Grass Valley Carlin-type gold project on an all-inclusive fixed-rate basis, chargeable only for dill holes completed to target depth, of which the Company may elect to pay Drill NV up to 25% in the form of NGE common shares.
Under the Agreement:
- NGE shall deliver a deposit of $1,433,750 USD to Drill NV to secure specialized tooling to improve penetration rates and better case holes through the alluvium units above the bedrock, and to lock in pricing.
- Upon successful completion of each drill hole to its target depth of up to 4,500 feet, Drill NV shall invoice NGE at an all-inclusive fixed rate of $185 USD per foot, expected to be paid in the form of 50% in cash, 25% credited from the deposit, and 25% in NGE shares, calculated based on a 20% discount to NGE’s 30-day VWAP share price, subject to TSX Venture Exchange approval.
Discussing the Agreement, NGE President, James Buskard: “Traditional drilling contracts force explorers to shoulder 100% of the technical risk of a drilling program (i.e. the drilling conditions), as well as 100% of the execution risk (i.e. the competence of the drillers and the condition of their equipment). This situation ultimately leaves explorers accepting widely variable and unpredictable drilling costs, plus even worse, paying for drill holes that are abandoned before they reach their target depth, which is infinitely expensive on an information-per-dollar basis. These risks and resulting cost increases are compounded at projects like South Grass Valley due to the industry-wide shortage of drillers with the experience needed to routinely complete deep holes to their target depths in challenging Carlin-type drilling conditions.
“To avoid these known challenges, and specifically to provide both cost and depth certainty for our current drilling program, we are very pleased to be partnering with Drill NV. Over a period of more than 10 years, drilling deep holes in similar conditions, Drill NV’s team helped to develop the drilling strategies responsible for increasing the success rates for holes reaching target depth at nearby Goldrush - strategies which continue to be applied today at Fourmile. Based on this experience, Drill NV has agreed to take on all of the technical and execution risk of our drilling program by agreeing to a fixed, all-inclusive footage rate, and to only invoice us for holes that successfully reach their target depth.
“By agreeing to pay up to 25% of the total cost of the program in NGE shares, we are aligning our interests and solidifying our partnership to advance what we believe is the most exciting Carlin-type project in Nevada outside of the Nevada Gold Mines portfolio. From a funding perspective, after deducting 25% from the initial deposit to purchase new specialized tooling and supplies, plus 25% paid in the form of shares, our residual marginal cash drilling costs will be only 50 cents per dollar of drilling. This means that each additional dollar we spend on the program will support approximately two dollars worth of drilling that is guaranteed to reach target depth.
“Reducing both our technical and execution risk at the same time as lowering our marginal costs is a game changer for the project; however, equally importantly, with Drill NV responsible for all aspects of the drilling, our technical team is now able to focus 100% where we create maximum value: on the geology. With drilling expected to begin in about a month, our team is eager to again see the steady stream of new core arriving from the field. Once drilling begins, the Company plans to resume its approximately monthly drilling updates to provide information on hole locations, metres drilled, preliminary geologic observations, and how each relate to its target concept. Depending on the timelines associated with drilling, core logging, receiving assays, and integrating the resulting data into the Company’s geologic model, NGE expects to release drilling results in batches that will likely include multiple drill holes.
To review the results to date and NGE’s plans to advance its primary East Golden Gorge target at South Grass Valley, the Company encourages its stakeholders to visit the interactive 3D VRIFY model prepared for its recent September 15, 2021, news release, available at: https://vrify.com/decks/September-15-2021-press-release. Also, to follow along as its team shares photos from the field and core logging facility, NGE encourages its stakeholders to subscribe to one or more of its social medial channels, as well as to sign up to its email list to receive its news releases.
About Nevada Exploration Inc.
With mature, exposed search spaces seeing falling discovery rates, NGE believes the future of exploration is under cover. Nevada’s exposed terrains have produced more than 200 million ounces of gold, and experts agree there is likely another 200 million ounces waiting to be discovered in the half of Nevada where the bedrock is hidden beneath post-mineral cover. NGE has spent more than 15 years developing and integrating new hydrogeochemistry (groundwater chemistry) and low-cost drilling technology to build an industry-leading, geochemistry-focused toolkit specifically to explore for new gold deposits under cover, and the Company is now advancing a portfolio of projects totalling more than 180 square kilometres.
NGE’s most advanced project is South Grass Valley, located approximately 50 kilometres south-southwest of the Cortez complex, operated by Nevada Gold Mines (Barrick Gold Corp. and Newmont Corporation joint venture), within the specific region of north-central Nevada that hosts Nevada’s largest Carlin-type gold deposits (“CTGDs”). Since acquiring the project, NGE has completed: an infill borehole groundwater sampling program, detailed air magnetic and gravity geophysics surveys, a soil geochemistry sampling program, an initial diamond core drilling program consisting of 10 stratigraphic orientation holes, and a follow-up reverse-circulation drilling program consisting of 17 holes to increase the density of its bedrock sampling.
Based on the results of its combined exploration datasets, NGE believes it has discovered a mineral system at South Grass Valley with the architecture and scale to potentially support multiple CTGDs. As the Company continues to advance the project, per NI 43-101, 2.3(2), the Company must remind its stakeholders that the project remains an exploration target for which the potential quantity and grade of any mineral resource is still conceptual in nature, and that it is uncertain if further exploration will result in the target being delineated as a mineral resource.
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Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Wade A. Hodges, CEO & Director, Nevada Exploration Inc., is the Qualified Person, as defined in National Instrument 43-101, and has prepared the technical and scientific information contained in this News Release.
This news release is not an offer of the shares of the Company for sale in the United States or elsewhere. This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the shares of the Company, in any province, state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such province, state or jurisdiction.
Cautionary Statement on Forward-Looking Information:
This news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking information”) within the meaning of applicable securities laws, including, without limitation, expectations, beliefs, plans, and objectives regarding projects, potential transactions, and ventures discussed in this release.
In connection with the forward-looking information contained in this news release, the Company has made numerous assumptions, regarding, among other things, the assumption the Company will continue as a going concern and will continue to be able to access the capital required to advance its projects and continue operations. While the Company considers these assumptions to be reasonable, these assumptions are inherently subject to significant uncertainties and contingencies.
In addition, there are known and unknown risk factors which could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained herein. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the risks inherent in mineral exploration, the need to obtain additional financing, environmental permits, the availability of needed personnel and equipment for exploration and development, fluctuations in the price of minerals, and general economic conditions.
A more complete discussion of the risks and uncertainties facing the Company is disclosed in the Company’s continuous disclosure filings with Canadian securities regulatory authorities at www.sedar.com. All forward-looking information herein is qualified in its entirety by this cautionary statement, and the Company disclaims any obligation to revise or update any such forward-looking information or to publicly announce the result of any revisions to any of the forward-looking information contained herein to reflect future results, events or developments, except as required by law.
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