TORONTO, May 20, 2014 (GLOBE NEWSWIRE) -- Nevada is one of the largest sources of gold in the world. Newmont Mining, with a market cap of $12 billion, operates the 300,000 oz per year Phoenix-Fortitude Gold and Copper mine in Nevada.
The Phoenix-Fortitude deposit has historic production of more than 3 million ounces of gold and still contains an additional 6-8 million ounces of gold.
Phoenix Gold (TSX-V:PXA), a brand new company listed on the TSX venture on 25th April 2014, has raised a few eyebrows by picking up strategic claims surrounding the Newmont deposit.
PXA President and CEO Glenn Laing is an investment banker who has raised $1 billion in capital markets.
Typically, the majors wait until the junior company runs out of money before making an offer to acquire adjacent assets. Laing does not intend to let that happen. Surface sampling has convinced him that PXA has a possible deposit close to surface which can be mined immediately and send to local mills to generate cash.
"Over the course of four years we acquired these claim blocks in Nevada located on the boundaries of Newmont's Phoenix-Fortitude Mine," explains Laing in an exclusive interview with Financial Press, "These claims belong to old ranching families who have generational tensions with the big mining companies."
Laing has a track record of savvy acquisitions, including the Condor Gold Project in Ecuador, which has proven significant new gold and copper resources for Ecuador Gold and Copper.
"We acquired the Nevada assets because of the patience and expertise of our co-founder Don McDowell," states Laing, "Don is a veteran land-man who also happens to be a well-known country singer."
McDowell performs with a band called 'Rebel Hearts' which is regularly on the country Billboard charts. How exactly he got the claims is unknown, but it is safe to say McDowell has more in common with a 3rd generation Nevada Rancher than your average mining executive with a PHD in geology.
Newmont's Phoenix-Fortitude Mine and Phoenix Gold claims lie in the heart of the Battle Mountain–Eureka Trend which features High-Grade Structural Gold-Silver Deposits and Gold-Copper-Moly Porphyry Systems.
"We are planning to drill all our claims over the next 12 months," states Laing, "starting with the Plumas claim, which is only about 1000 meters long by 200 meters wide. We already know that the entire claim block is mineralized. Phoenix Gold is not just a case of 'closeology'. We have good rocks and good reasons to be there."
In a mature mining state like Nevada, next to a big profitable mine, the rocks in the ground are typically worth about $20 to $30 dollars an ounce. Laing's agenda over the next 12 months is to prove up these ounces. If Phoenix Gold discovers 500,000 indicated ounces that would give it a valuation 600% higher than it is currently. Grab samples on the Plumas claim block have been as high as 29 grams/per tonne of gold.
"The Plumas claim is literally on the Phoenix-Fortitude mine boundary," states Laing, "An Airborne survey has shown almost-identical geology on each of our claims. You see 'hot spots' indicating a high concentration of metals, intersected by major fractures, which carry the gold, silver and copper metals from great depths to the surface. That is the reason there is an 8 million ounce deposit there."
In the next three months Phoenix Gold is going to drill five holes on the Plumas claim. The results of each hole will be published as the data comes in. This drill and news release cycle will be repeated on the other claims.
"We are confident that we will grow a 43-101 gold resource which will significantly raise the valuation of our company," states Laing. "It is also possible that we may enter a 'co-mingling agreement' with surrounding mining companies. It's a win-win situation. Phoenix would end up being a gold producer and could be taken out by an intermediate company. Either way, we will not be cornered with no-where to go. With this asset, there are multiple exit strategies."
Phoenix Gold is currently trading at .07 with a market cap of $2.1 million.
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Phoenix Gold Corp. Glenn Laing President & CEO +1 (647) 865 3101