Gold Bull has executed a Letter of Intent (“LOI”) to acquire 100% of the Coyote Mine project (“Coyote” or the “Project”) from private company Desert Mountain Gold LLC. Coyote is located in Juab County, Western Utah, USA and is considered prospective for gold and silver mineralisation. The Project comprises 83 lode mining claims for approximately 1715 acres and two State Metalliferous Mineral Leases for approximately 1370 acres for a total of 3085 acres.
Gold Bull has the option to acquire 100% of the project by making an ongoing annual payment of US$50,000 which will convert to a 3% net smelter royalty (NSR) in favour of Desert Mountain Gold LLC upon production commencing. Gold Bull will have the election to reduce the net smelter royalty by paying $1,000,000 per 1% NSR reduction, to reduce up to 2% of the NSR. Completion of a definitive agreement is subject to Gold Bull conducting detailed due diligence of the Coyote Project.
- High grade historical drilling results of up to 8.19g/t gold (Au) and 1060g/t silver (Ag)1
- Sporadic and shallow historical drilling has not adequately tested the main target/feeder zone because the shallow zone is typically leached of metal sulphides
- Multiple high grade rock chip sample results, however poor location data provided (requires field verification during due diligence period)
- Prospective and fertile geological setting including a 150m outcropping jasperoid vein
Coyote Project Overview
The area of interest is located in the Great Basin portion of the Basin and Range Province of the western United States. The general landscape of the area is dominated by north-south trending fault-block mountain ranges separated by intervening sediment-filled basins or valleys. The age of most of the rocks in the mountain is Precambrian and Paleozoic. The rocks are mostly shales, quartzites, and carbonates (dolomite and limestone). There are intrusive and extrusive rocks found in the valleys and mountains and are generally of Tertiary age. The source of much of the volcanism is calderas. The youngest rocks are Quaternary in age and are mostly lake deposits, stream deposits, and alluvial fans along the mountain fronts. In the Great Basin the drainage is mostly interior, i.e., the rivers and stream do not flow out to the ocean. They flow into closed basins found between the mountain ranges. The streams in the area of consideration flow into the Sevier Lake, which is a closed basin and has no outlet to the sea.
There are alteration, mineralization, and jasperoids in the volcanic and Precambrian rock covered by the claims. There is a small mine on the property called the Coyote Mine with small production and reported 1000 ounces silver2 . A desk top review of the existing limited drilling data indicates excellent drilling opportunities along a mostly east-west structure covered by the claims.
Two of the historical drill holes contain high gold values, CK-14 and CK-23. The drill holes are located in or very close to the small open pit, Coyote Mine (see Figure 1). CK-14 has an intercept of 8.19g/t (0.289 opt) gold and 1060g/t (37.41 opt) silver at 30 to 35 ft. for 5 feet1 . It intercepted a silica vein at this depth in the mineralized structure. CK-23 has an interval of 150 to 155 ft. that was assayed for gold and silver with 2g/t (0.074 opt) gold and 814g/t (28.72 opt) silver3 . It was drilled 70 degrees from the horizontal parallel to the mineralized structure therefore probably did not intercept the silica vein intercepted in CK-14. The Company has not done sufficient work to classify the historical information as current to NI 43-101, and is not treating the historical disclosure as a current mineral estimate.
Cherie Leeden, B.Sc Applied Geology (Honours), MAIG, a “Qualified Person” as defined by National Instrument 43-101, has read and approved all technical and scientific information contained in this news release. Ms. Leeden will become the Company’s Chief Executive Officer, following the closing of the acquisition of the Big Balds gold project, previously announced on August 17, 2020.