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History of the
Atlanta Gold Mine
The Atlanta project lies within the historic Middle Boise Mining District in an
area with a history of exploration, development, and production of gold and
silver ore since its discovery in 1863. The project site is located on top of
Atlanta Hill, which rises approximately 1,900 feet above the town of Atlanta,
Idaho, to a maximum elevation of 7,200 feet above mean sea level (msl).
Gold was discovered in the vicinity of Atlanta in 1863 and the region has since
undergone sporadic periods of metal production. The most productive years were
during the periods from about 1870 to 1885, 1902 to 1917, and 1932 to 1957.
Estimated production from the Atlanta lodes during those time periods was
297,000 ounces of gold and 2.6 million ounces of silver. The Atlanta lode and
associated lateral veins occur in a biotite granodiorite, which has been
affected to varying degrees by hydrothermal alteration.
Gold and silver mineralization is closely associated with the more intensely
silicified zones of the biotite granodiorite. A geologic alteration model has
been developed for the deposit to represent this association. Present day
exploration activities started with Atlanta Gold in 1985 and have continued
through to the present. Several joint ventures were established over these years
in order to explore the deposit. These included the Ramrod Gold Corporation and
Newmont Mining Ltd. Atlanta Gold Inc. is the current operator of the property
through its wholly-owned subsidiary Atlanta Gold Corporation.
Atlanta Gold Corporation holds 100% operating interest in the property, with a
firm option to acquire 100% ownership of the property.

Permits and Environmental
The Atlanta gold property operates under a variety of permits issued by
local, State and Federal agencies.
Current activities at Atlanta are in
compliance with all required permit conditions, including monitoring and
reporting conditions. Certain operating permits may be amended to more
closely reflect planned operations.
Exploration
The Company is engaged in the exploration and development of the Atlanta Gold project
(“Atlanta”), an advanced-stage gold property near Atlanta, Idaho, U.S.A.
Atlanta is the cornerstone of the Company’s future. It is located in a stable jurisdiction with
minimal political risk in which mineral development rules are well known and a skilled
workforce is available. The project has exceptional exploration potential, at a time when the
demand for gold is increasing and supply is
limited.
In early 2008, the Company changed the mining strategy for Atlanta from bulk mining
and cyanide heap leaching, to a combined shallow open-pit and underground operation
with an on-site milling facility with no cyanide circuit. This new mining strategy will
produce both a gravity concentrate and a precious metal rich sulphide concentrate to
be custom smelted. It will also reduce the environmental footprint by 95% and increase
expected metal recovery rates from 63% to 90%. Each of these improvements is critical to
the sustainable development of the Atlanta gold mine.
This more selective method of ore extraction positively addresses environmental concerns
identified during previous permitting efforts. Management is confident that by working
closely with environmental groups, the town of Atlanta and surrounding communities,
federal, state and local agencies as well as other stakeholders, it will be successful in obtaining
the regulatory approvals necessary to develop a combined shallow pit and an underground
mine at Atlanta in a timely
manner.
Highlights from Operations -
2008
In 2008 the Company implemented a new strategy which focused on developing plans for:
• a small-scale surface operation with a small environmental footprint
• a mining operation confined to private lands
• an 800-ton-per-day pilot processing plant to produce a gravity concentrate, and
a flotation concentrate which can be produced without the use of cyanide. The
concentrate will be sold to others for final processing. In this way, Company
operations in Idaho will be cyanide free thus minimizing the environmental impact.
• lower consumption of water. When the pilot mill is constructed in 2010, treatment
and recycling of water will be an integral part of processing the ore.
• continued investigation of the underground potential of the 11,400-foot longAtlanta Shear Zone from which, historically, 340,000 equivalent ounces has been
extracted from high grade sections at gold prices of US$20-$35 per ounce using
cut-off grades of 0.5 ounces per short ton (“opt”) (17.1 grams per tonne) up to and
including 1935 and 0.4 opt (13.7 grams per tonne)
thereafter.
In
addition, during 2008 the Company achieved the
following:
§ Appointed Ernie Simmons as Chief Operating Officer of the Company. Mr.
Simmons has a long history of accomplishments in the industry, and now resides in
Boise, Idaho.
§ Relocated its Idaho principal office from Mountain Home to Boise, which is closer
to the Atlanta project, and to regulators, suppliers, interest groups with whom the
Company needs close communications.
§ Established open dialogue and communications with the four most significant
environmental groups in Idaho regarding shared environmental concerns and the
optimum strategy to advance the project.
§ Continued to treat 2.5 million gallons of water per month to remove naturallyoccurring
arsenic which would otherwise flow untreated into Montezuma Creek and
in turn into the Boise River.
§ Eliminated the use of cyanide for heap leaching from the mining plan. This results
in a much lower environmental impact. With an expected environmental footprint
which is only 5% of that previously envisioned, the new mining plan appears to have
been well received by the public, regulators and other stakeholders.
§ Increased surface drilling productivity from 8,000 feet (2,438 metres) in 2007 to
15,000 feet (4,572 metres) in 2008.
§ Reduced the cost of drilling from $98.20 per foot in 2007 to $32.38 per foot in
2008.
§ Completed 2,180 feet (664 metres) of trenching across the Atlanta Shear Zone
which exposed and identified significant gold-bearing mineralization in 22 out of
25 trenches in the Idaho, Monarch and the East Extension areas and 14 out of the
22 mineralized trenches showed samples with assays of 0.10 opt Au or higher. This
surface expression identified a number of excellent gold resource targets amenable to
low-cost selective shallow open-pit mining which will provide early plant feed. All
samples taken above the Shear Zone had anomalous gold.
§ Raised total proceeds of $7,783,000 from non-brokered private placements.
The Company also staked 367 contiguous lode unpatented claims totaling 6,880 acres at
Rocky Bar to expand its regional property interests in Idaho. The total landholding
combined with Atlanta Project is 9,077 acres.
Mineral Reserves and
Resources
Cautionary note to U.S.
investors concerning Measured, Indicated and Inferred mineral
resources:
These terms are required by the CIM's "Standards on
Mineral Resources and Reserves, Definitions and Guidelines".
U.S. investors
are cautioned not to assume that all or any part of the stated mineral resources
will be converted into reserves.
Please also see additional cautionary notes
under Legal Notice.
The
Table 1. shows the resource estimate as per NI43-101 Technical Report of
March 30, 2009
authored by Mr. William L. Josey, a Qualified Person as
specified in the NI43-101 and is a Registered
Professional Geologist in
the State of Arizona.
Table 1. SUMMARY OF MEASURED AND INDICATED RESOURCE ESTIMATE
|
|
|
SILVER |
Total | ||||||
|
Area |
Cut-Off Grade (opt) |
Gold Grade (opt) |
Tons (000’s) |
Ounces of Gold (000’s) |
Ratio of Silver to Gold Ounces |
|
Price Factor (2) |
Equivalent | |
|
|
|
|
|
|
|
|
|
|
|
|
East and West Monarch
(1) |
0.05 |
0.111 |
419.3 |
46.4 |
4.28 |
198.6 |
73.7 |
2.7 |
49.1 |
|
Idaho
(1) |
0.05 |
0.060 |
82.3 |
4.9 |
4.28(4) |
21.1 |
73.7 |
0.3 |
5.2 |
|
TOTAL |
|
0.095 |
501.6 |
51.3 |
4.28 |
219.7 |
|
3.0 |
54.3 |
|
UNDERGROUND
RESOURCE: |
|
|
|
|
|
|
|
|
|
|
Monarch and Idaho
(1) |
0.10 |
0.161 |
2,125.8 |
343.3 |
2.02 |
797.7 |
73.7 |
10.8 |
354.1 |
|
East Extension (5) |
0.10 |
0.177 |
370.5 |
65.7 |
0.80 |
52.5 |
73.7 |
0.7 |
66.4 |
|
TOTAL UNDERGROUND
RESOURCE |
0.10 |
0.164 |
2,496.3 |
409.0 |
1.81 |
850.2 |
73.7 |
11.5 |
420.5 |
|
TOTAL RESOURCE |
0.154(3) |
2,997.9 |
460.3 |
2.12 |
1,069.9 |
|
14.5 |
474.9 | |
(2)
Price Factor, using closing prices as of
the close of business on November 3, 2008 on
(3)
Average grade of gold per ton =
0.154 ounces per ton (460,300 ounces / 2,997,900 tons)
(4)
Estimated ratio of silver to gold
ounces
(5)
The resource for the East
Extension is a total resource. It has not been decided with certainty whether
the East Extension area can be mined by open pit methods or underground or
both.
(6) The average grade of gold
equivalent (including silver resources as a gold equivalent) per ton = 0.158
ounces per ton (474,900 ounces / 2,997,900 tons)
The Table 2. shows the resource estimate summary at
various cut-off grades.
Table
2. SUMMARY OF RESOURCE ESTIMATES
|
ATLANTA TOTAL RESOURCES | ||||||
|
CUT-OFF GRADE (opt Au) |
CLASS |
TONS (000’s |
GOLD (Au) |
SILVER (Ag) | ||
|
Grade (opt) |
Ounces (000’s) |
Grade (opt) |
Ounces (000’s) | |||
|
0.025 |
Measured |
15,452.2 |
0.063 |
974.1 |
0.097 |
2,564.4 |
|
Indicated |
5,706.4 |
0.055 |
313.5 |
0.107 |
609.6 | |
|
Measured
+Indicated |
21,158.6 |
0.061 |
1,287.6 |
0.150 |
3,174.0 | |
|
Inferred |
9,520.9 |
0.053 |
499.8 |
0.067 |
636.4 | |
|
0.050 |
Measured |
7,328.7 |
0.094 |
688.5 |
0.246 |
1,805.7 |
|
Indicated |
3,024.6 |
0.091 |
275.7 |
0.137 |
415.1 | |
|
Measured
+Indicated |
10,353.3 |
0.093 |
964.2 |
0.215 |
2,220.8 | |
|
Inferred |
2,933.5 |
0.049 |
143.6 |
0.102 |
298.8 | |
|
0.100 |
Measured |
1,949.2 |
0.164 |
319.8 |
0.437 |
851.4 |
|
Indicated |
741.4 |
0.163 |
121.0 |
0.185 |
137.4 | |
|
Measured
+Indicated |
2,690.6 |
0.164 |
440.8 |
0.368 |
988.8 | |
|
Inferred |
919.6 |
0.150 |
138.2 |
0.168 |
154.0 | |
|
0.150 |
Measured |
750.6 |
0.236 |
176.9 |
0.623 |
467.8 |
|
Indicated |
322.1 |
0.222 |
71.6 |
0.204 |
65.8 | |
|
Measured
+Indicated |
1,072.7 |
0.232 |
248.5 |
0.497 |
533.6 | |
|
Inferred |
299.5 |
0.214 |
64.2 |
0.075 |
22.3 | |
Plan for Operations - 2009
The Company plans to achieve the following objectives at Atlanta:
a.
complete 12,000 feet (3,658 metres) of shallow core drilling to a depth of 400 feet(122 metres) on the East Extension, West Monarch and Idaho zones;
b.
complete 33,000 feet (10,058 metres) of core drilling to an intermediate depth of1,200 feet (400 metres) on the East Extension and Monarch zones;
c.
excavate and sample 5,000 feet (1,524 metres) of trenches to further evaluate the nearsurface potential of the Atlanta Shear Zone. The 2008 trenching program exposed
and identified significant gold-bearing mineralization in 22 out of 25 trenches. All
samples taken above the Atlanta Shear Zone had anomalous gold;
d.
rehabilitate the first 800 feet (244 metres) of the 900 Adit;e.
subject to obtaining regulatory approvals, rehabilitate the next 1,475 feet (450metres) of the 900 Adit and complete a 12,000-foot (3,658-metre) underground
drilling program from the 900 Adit;
f.
redesign of reclamation ponds at the 900 Adit;g.
continue enhancement of Atlanta’s environmental performance, including ongoingremoval of naturally-occurring arsenic from historic water effluents;
h.
continue collaboration with local communities, environmental, regulatory and otherstakeholders;
i.
evaluate several alternative sites to accommodate infrastructure related to miningoperations;
j.
k.
complete an internal pre-feasibility study of the updated resource;l.
complete a business plan to process 300,000 tons of ore and produce 40,000 ouncesof gold per year, with start-up production expected to commence by the third quarter
of 2010;
m.
increase the mineral resource inventory, targeted for 600,000 equivalent ounces ofgold by December 31, 2009.
n.
continue economic, environmental and technical studies and secure water permitsand rights required to advance the project to production; and
o.
secure the financing required for all of the above.The combination of a proven record of historical production, a Shear Zone with an 11,400-
foot strike length, significant depth potential and multi-million ounce potential, presents
what management believes to be an outstanding value proposition.