Fourmile Basin

Fourmile Basin Project, Nevada, US

On June 18, 2020, Austin Gold entered into a mineral lease agreement with La Cuesta International, Inc. (“LCI”) for exploration and mining rights and access to certain mineral claims on the Fourmile Basin Property situated in Nye County, Nevada.

Property Location and Access

Austin Gold’s Fourmile Basin project is an epithermal, gold-silver exploration project located in Nye county, Nevada, about 30 miles (48 km) east-northeast of the historic mining district and town of Tonopah. The property has excellent access and is situated in a favorable jurisdiction for mining. The Fourmile Basin project is located about 35 miles (57 km) southeast of the Round Mountain Mine.

Project Stage

 The project is an exploration stage project. There are no known mineral resources or reserves on the project at this time. There has been insufficient exploration on the project to estimate a mineral resource. It is uncertain if further exploration will result in the estimation of a mineral resource. Historical exploration has been conducted on the property. Austin Gold is pursuing exploration activities including a program of additional geologic mapping, surface rock-chip sampling, and possible geophysics followed by drilling.

Local Resources and Infrastructure

The nearby historic mining town of Tonopah is a hub city for exploration, development, and mining activities in central Nevada.  The nearby Round Mountain Mine owned by Kinross Gold, one of the largest gold mines in Nevada, has over 800 employees, nearly 100 of whom live in Tonopah.  The majority of the remainder live in the communities of Hadley and Carvers that are near the mine.  Over 200 contractors also work at Round Mountain, and many of these stay in Tonopah while working onsite.  Accordingly, the project area is ideally situated to provide a local mining workforce and all infrastructure, contractor support, transportation, and suppliers that could be needed.  Numerous hotels, motels, and restaurants are available for visiting workers as well.

Property Claims and Lease

The Fourmile Basin property consists of a total of 312 unpatented lode mining claims in four groups under lease or sublease from LCI. These claim groups are Fourmile Basin, MM-11, CP Claims, and NS Claims. Two of the claims at Sinter Hill in the Fourmile Basin group are leased from a third party. Total area of the property is approximately 6410 acres (2594 ha).

The lease involves pre-production payments, production royalties, payment of annual claim fees and landholding costs, minimum exploration costs and fulfilment of certain obligations on the third-party lease.

Geology

Fourmile Basin is localized along the southern margin of the +12-mile (20 km) diameter Big Ten Peak caldera, one of multiple volcanic centers within the mid-Tertiary-age Central Nevada Volcanic Field. The basin is approximately 6 miles (10 km) long by 3.7 miles (6 km) wide and is filled with a variety of alluvial deposits that range in thickness from a few feet (meters) to hundreds of feet (100s of meters). Surrounding the basin are thick sequences of generally Oligocene welded and non-welded ash flow tuffs and volcaniclastic deposits. Projecting into the northern end of the basin is Sinter Ridge, a north-south trending, 2,300 feet by 500 feet (700 m by 150 m) siliceous hot spring sinter apron with associated quartz feeder veins that extend for another 600 meters north of the sinter apron.

Exploration History

Seemingly concentrated in a 9 km long zone on the east side (East Basin Zone), is float of strongly silicified volcanic rock, chalcedonic veining, and silicified breccia. The silicified boulders of the East Basin Zone are locally +1 m in diameter, and quartz textures and the geochemistry of samples collected from the boulders indicate that the rocks are not derived from Sinter Ridge.

At Sinter Ridge, exploration work and drilling by Marathon Gold and Cominco American in the 1980s and Kennecott Exploration in 1990 focused on near-surface gold-silver mineralization. Drilling was generally shallow and directed toward finding a low-grade resource that could be mined by open pit. Drilling by Wolfpack Gold Corp. in 2013 and 2014 to depths between 675 and 1265 feet (206 to 386 m) attempted to test the Sinter Ridge feeder veins at depth but 3 of the 5 holes appear to have missed their intended targets and the one 2014 hole was not assayed.

A SkyTEM electromagnetic and magnetic survey was flown in early 2019 by the prior operator of the project, with an interpretation completed by Fritz Geophysics. The operator then dropped the property to focus its exploration elsewhere.

The primary exploration concept at Fourmile Basin is to find the source of the float and boulders of the East Basin Zone. Austin Gold and LCI geologists believe that the boulders may be sourced from veins and silicification associated with a major structural break that is now covered by alluvium and post-mineral volcanic rocks. Calcite replacement textures in the veins suggest a boiling epithermal system and the style of silicification as well as the geochemistry indicates that the rocks are derived from the upper levels of an epithermal gold-silver mineral system. These geologic features all suggest that a robust and potentially high-grade vein system may be preserved beneath the alluvium of Fourmile Basin. Austin Gold plans to re-evaluate the existing SkyTEM data, possibly conduct additional geophysics, and then determine the best locations for drill testing.

Additional vein and disseminated gold-silver drilling targets are being developed north of the East Basin Zone at the MM-11 Zone where LCI sampled epithermal veins in a large area of altered volcanic rocks. The CP and NS claims were recently located to cover ground with prospective hydrothermal alteration. Little work has been done on the CP claims.

Exploration Program

Permitting for exploration work is through the United States Bureau of Land Management at the southern end of the East Zone, whereas the rest of the property is on United States Forest Service (USFS) lands. Austin Gold has applied for drilling permits on the USFS portion of the Fourmile Basin project but is aware that the Forest Service may limit the selection of drill sites at the Sinter Ridge area due to its being a Native American chalcedony source.

For the Sinter Ridge and MM-11 areas, Austin proposes a program of additional geologic mapping, surface rock-chip sampling, and possible geophysics followed by drilling. The CP and NS claims will be mapped and sampled to determine what further work will then be recommended.

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