Excalibur Resources Unveils Exploration and Drill Program Targeted in Sturgeon Lake Mining Region

August 5, 2010

The vast mineral wealth of Ontario’s Sturgeon Lake mining region has attracted prospectors and mine developers for more than a century, and 112 years later they’re still making discoveries.

The Ontario Geological Survey says in its analysis of the Sturgeon Lake Area, “The [Sturgeon Lake] area has a long and interesting history of gold exploration dating back to 1898… There are many prospects, showings and properties and new ones have been discovered, or rediscovered, at the rate of several per year.”

The primary reason for the consistent interest and many successful discoveries is because Sturgeon Lake is also home to a type of deposit known as a Volcanogenic Massive Sulphide (VMS) deposit.

These types of deposits, which are the mineral basis for many of the largest mines in the world in Asia, Africa, and North and South America, are extremely rich. They don’t just contain a lot of minerals, they contain a lot of high-grade minerals.

For example, 19 million tonnes of ore have been extracted from six Sturgeon Lake VMS deposits. The typical grades have been very high. Such high-grade ore containing 9% zinc, 1.5% copper, 140 g/tonne silver and 0.5 g/tonne gold which is worth $350 per tonne at today’s metal prices.

All signs still point to there being a lot more yet-to-be-discovered resources in the Sturgeon Lake district. Excalibur Resources (CNSX:XBR) has acquired some assets in the region and is actively executing a technologically-advanced exploration program and has already discovered some more VMS-style grade ore.

Going for Gold and VMS in Sturgeon Lake

Excalibur Resources is an early-stage exploration company focused on exploring and developing a project in the Sturgeon Lake mining region. The company’s 100%-owned Sturgeon Lake Property consists of 8,816 hectares in Northwestern Ontario.

This sizeable property has already shown strong potential. It contains multiple zones of sulphide-bearing conductors that cumulatively exceed 27 km of strike length.

This is a “district-scale” potential project located in Northwestern Ontario where some of the world’s largest mines are located. Excalibur’s properties are in the same geological Abitibi Greenstone Belt that hosts the Red Lake and Pickle Lake mines, has produced 160 million ounces of gold, and extends from Sangold in Manitoba all the way to Osisko Mining in Western Quebec.

With high-potential assets in a very prolific area, Excalibur isn’t holding back developing the assets. The company recently announced it completed a high-resolution VTEM (Versatile Time-Domain Electromagnetic) survey across the most prospective sections of its Sturgeon Lake property. The VTEM survey was conducted at 100 meter intervals for a total of 1,000 line kilometers.

The VTEM survey will accelerate the exploration process. It’s the “ultimate metal detector” and, according to VTEM firm Geotech, is a “fly-to-drill” technology. In other words, its VTEM survey results are so much more accurate than older airborne geophysical surveys that it allows the user to identify potential drill targets from the survey without having to do extensive, time-consuming geochemical testing and surface sampling.

Since VMS deposits are highly conductive, they tend to have a noticeable signature on electromagnetic surveys. This will go a long way to pinpointing the highest-potential drill targets for more advanced exploration.

It’s going to take time to develop the potential of the Sturgeon Lake property and there are a lot of unknowns. But Excalibur does not have its entire future pinned on a big discovery, regardless of the probabilities of operating in an area like Sturgeon Lake. That’s where the company’s acquisition-minded strategy provides some good diversification.

Returning to the Silver King Mine

Excalibur’s other key property is the Silver King Mine property.

Excalibur has an option to acquire a 100% interest in the Silver King property, consisting of 75.7 hectares of real estate in the Nelson mining region of British Columbia, Canada.

This area has a long history of mining too. The Silver King Mine was initially put into production more than a century ago. Historical records show that Silver King was a very high-grade copper and silver mine. The mine produced approximately 15,000,000 lbs. of copper (grading 3%) and 4,000,000 ounces of silver (grading 20 ounces per tonne).

Early exploration results show Silver King still has more resources to be discovered. In the fall of 2009 Excalibur completed a 25-hole, 2,137 meter drilling program. The program, although limited, discovered an entirely new vein structure.

The assay results from that strike include grades consistent with the production numbers from when the Silver King mine was in operation. The results included 439 g/t silver, 0.7 g/t gold, 3.2% copper, 0.36% zinc, and 0.1% lead across 3.95 meters.

Share Structure

Issued and Outstanding Share Capital: 24,585,763
Stock Options Outstanding: 1,838,000
Fully-diluted: 32,601,261
Total Market Cap (at 19 cents per share): $4.7 million

A Critical Time

Excalibur is still in its relative infancy and now is a critical time for the company.

It has two properties in the early stages of development. In these stages, management plays a critical role in their development. The ability and experience needed to analyze early exploration work, identify drill targets, and tap financial markets for new capital when necessary are critical to a company’s success.

Excalibur has the management with extensive experience in doing all of that:

Dr. James D. Kendall, President & CEO - attended Queen's University where he completed a Masters of Mining Engineering that included studies in mineral exploration, mineral economics and geostatistics. Dr. Kendall also holds Masters and Ph.D. degrees in Electrical Engineering from Carleton University, as well as a Bachelors degree in Engineering Physics from McMaster University. Dr. Kendall held a management position at Barrick Gold where he worked on innovative mining and mineral exploration technologies.

Tim Gallagher, Director, Chairman & Chief Financial Officer - is a graduate in commerce from McMaster University, and holds a Master of Business Administration from York University and is a Chartered Financial Analyst. He has been a director or senior officer of a number of public and private companies including Inflection Capital Inc. and Xtierra Inc., Xmet Inc., and Serengeti Resources. Previously he was in institutional sales for Loewen Ondaatje McCutcheon and Union Bank of Switzerland (Canada). Mr. Gallagher has assisted a number of companies implement their growth plans primarily through the TSX Venture Exchange Capital Pool Program since 1997.

Dianne Szigety, Director, Corporate Secretary - has over 20 years experience in the securities industry and since 1994 has offered regulatory filing solutions and legal assistant consulting services to both public and private companies. Previously, Ms. Szigety was a senior legal assistant in the corporate securities department of Campney & Murphy, Barristers & Solicitors, in Vancouver, BC. Ms. Szigety is an officer of PMI Gold Corp., Canadian Mining Company Inc. and Maxim Resources Inc., and a director and/or officer of several private-stage companies.

Andrew Thomson, Director - is an entrepreneur who has been active in mineral exploration since 1993. Currently Mr. Thomson is the President of Soltoro Ltd., a TSXV-listed exploration mining company focused on discovering bulk tonnage copper, gold and silver deposits in Mexico, and a Director of Gossan Resources, a TSXV-listed company engaged in the exploration and development of a broadly diversified portfolio of properties in Manitoba.

David J. Libby, Director - is a Mining Engineer and is currently a Senior Associate and Consultant with Behre Dolbear & Company Ltd., Toronto, Ontario. Mr. Libby served as Executive Vice-President, Mining and Vice-President Mining Operations-Chile with Aur Resources Inc. from 1994 until retirement in 2007. Mr Libby is a graduate of the Camborne School of Mines and a registered Professional Engineer in the Province of Ontario.

Andrew Robertson, Director - currently serves as a Vice President at Inflection Capital Inc. Prior to this position his career spanned 25 years in the debt financial markets with roles that included Senior Vice-President at GE Capital Solutions, Director, Private Debt Investments at Canada Life Assurance Company and Director, Loan Syndications at RBC Capital Markets. Mr. Robertson received a B.Comm(Hon) degree from Carleton University and an MBA from the University of Toronto.

The Bottom Line

Although it is very early on in the company’s development, Excalibur Resources is in a very advantageous position.

Its combination of highly prospective properties in two very politically safe and historically prolific mining regions puts it in an excellent position to be able to find how much potential the assets really have.

It has proven that it’s going to advance those projects along a reasonable timeline. Conducting the VTEM survey was a big step forward for the Sturgeon Lake Mine property and the discovery of a new vein at the Silver King property will go a long way to establishing a sound basis for further exploration and development.

Follow Excalibur Resources ongoing development at www.excaliburresources.ca.

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Sources:

Excalibur Company Web Site
Ontario Geological Survey
Geotech: Fly-To-Drill