Miranda Gold Corp. - Red Canyon

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BPV and CONO Coal Canyon Fuse Red Canyon Red Hill TAZ

Why Colombia Pavo Real

Summary
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The Red Canyon sediment-hosted gold project is made up of 237 lode claims (7.7 sq mi / 19.9 sq km) along the Battle Mountain-Eureka Gold Trend in Eureka County, Nevada (Figure 1). The project covers a 3 sq mi (7.8 sq km) alteration cell developed in carbonate rocks that are age-equivalent to gold-bearing host rocks at the Cortez Hills, Pipeline and Gold Bar deposits. Exploration results include:

95 ft of 0.117 oz Au/t from 20 to 115 ft (29.0m of 4.01 g Au/t from 6.1 to 35.1 m) in drill hole KR-001 and 85 ft of 0.046 oz Au/t from 15 to 100 ft (25.9 m of 1.568 g Au/t from 4.5 to 30.5 m) in ROM07-01.
MR09-05C, a core hole completed by Montezuma Mines Inc., verified the results in KR-001, but with 30% higher grade (0.152 oz Au/t / 5.25 g Au/t) and 25% greater thickness (119 ft / 36.28 m). This is not a new discovery hole.
Three 2005 drill holes that identify a deeper, previously unrecognized gold system between the Ice and Gexa target areas.

In August 2008 Miranda finalized an Exploration and Agreement with Option to Form a Joint Venture with Montezuma Mines Inc. ("Montezuma"), a subsidiary of CMQ Resources Inc. Montezuma may earn a 60% interest in the Red Canyon project by funding US$4,000,000 in qualified expenditures over a five year period. To retain its 60% interest, Montezuma must then continue funding 100% of exploration costs to earn an additional 10% interest by completing a bankable feasibility study or funding US$10,000,000 in additional exploration.

CMQ's Vice President of Exploration, John Hogg, and Miranda's Senior Geologist, Steven Koehler, participated in the gold discoveries at West Leeville, Hardie Footwall Extension and Four Corners on the Carlin Trend. As such, Mr. Hogg and Mr. Koehler bring considerable knowledge and expertise regarding Carlin-type gold deposits to the Red Canyon project.

Figure 1. Location map illustrating the Red Canyon project and nearby gold deposits.

Location

Red Canyon is on the northwestern flank of the Roberts Mountains approximately 75 miles (120 km) south of Carlin, Nevada. The project is on the Battle Mountain-Eureka Gold Trend, a northwest alignment of bulk-mineable gold deposits including Pipeline, Cortez Hills, Gold Acres, Cortez, Horse Canyon, Gold Bar and Archimedes (Figure 1). The property is 12 miles (19 km) southeast of the Cortez Hills deposit, a +12.0 million ounce sediment-hosted gold deposit discovered by the Cortez Joint Venture (now Barrick Gold). The northwestern portion of the property adjoins U.S. Gold's Tonkin Springs property.

Geology

On a regional scale, the upper and lower plate rock packages are separated by a low angle, regional fault known as the Roberts Mountains thrust. At Red Canyon, uplift and erosion of the upper plate rocks created a "window" that exposes favorable carbonate host rocks. The "window" exposes strongly oxidized, decalcified, brecciated and silicified lower plate carbonate rocks over a three square mile area (7.8 sq km). Carbonate rocks at Red Canyon are age equivalent to rocks hosting the Cortez Hills and Pipeline gold deposits.

Four distinct rock packages occur on the project (Figure 2). They include:

Lower-plate, Silurian to Devonian age carbonate rocks dominated by silty to muddy limestone, calc-arenite, fossiliferous limestone, dolomite, siltstone and lesser chert. These rocks are included in the Horse Canyon, Devils Gate, Denay, McColley Canyon and Lone Mountain Formations. Lower plate carbonate rocks are the preferred host for multi-million ounce, sediment-hosted gold deposits along the Cortez and Carlin Gold Trends. Potential stratigraphic host horizons for disseminated gold occur in silty / debris flow units within the Denay and McColley Canyon, at the McColley Canyon-Lone Mountain contact, karst horizons in the Devils Gate, and in silty units of the Horse Canyon.
Upper plate, siliceous sedimentary rocks of the Vinini and Elder Formations. Chert, siltstone, mudstone and greenstone crop out in the western and southern portions of the project.
Tertiary volcanic rocks cover lower plate carbonate rocks in the central portion of the project.
Quaternary gravel / tuffaceous conglomerate deposits form a pediment in the northern third of the property. The pediment is a gently-north sloping surface away from the mountain range where the gravels cover carbonate rocks and potential exploration opportunities.

Geologic mapping illustrates chaotic bedding orientations and the periodicity of structural features at Red Canyon. The project is transected by southeast-plunging folds; and west northwest, northeast, northwest and east northeast-striking faults (Figure 2). Compilation of Red Canyon and Tonkin Springs structural data illustrates district scale patterns including: northwest and west-northwest faults transecting upper and lower-plate rocks, and a 310-degree alignment of Red Canyon prospects and Tonkin Springs gold inventories/resources. Similar northwest / west-northwest structural patterns are documented at the +12.0 million ounce Cortez Hills deposit and within gold deposits of the northern Carlin Trend.

At the surface, hydrothermal alteration in the form of iron oxidation, decalcification, silicification, clay, and barite/stibnite occurrences are exposed over a three square mile (7.8 sq km) area. In the subsurface, select drill holes contain oxidation that locally exceeds 1,000 ft (305 m) in depth.

Alteration extends to the north under pediment and volcanic rock cover at the Ice prospect. Recent drilling by Montezuma indicates that a Carlin-style alteration system is present beneath barren volcanic rocks as evidenced by elevated arsenic, mercury, antimony and thallium associated with zones of low-level gold. Additional drilling for near-surface, oxide gold mineralization is recommended in this area.

Figure 2. Red Canyon geologic map.

Exploration History

Previous exploration by Meridian, Tenneco, Great Basin, Hycroft, Kennecott, Newmont and Romarco focused on shallow, oxide gold targets at four separate prospects: Ice, Gexa, Red and Sage. Ninety-five percent of the historic drilling was less than 500 ft (152 m) deep. Only 14 holes reached depths greater than 1,000 ft (305 m).

Kennecott completed KR-001, a 2,500 foot (762.2 m) vertical drill hole at the Ice Prospect, to follow up on surface gold (>0.01 oz Au/t / 0.343 g Au/t) mineralization, in the footwall of the northwest-striking Wall fault. The hole intersected 95 ft of 0.117 oz Au/t from 20 to 115 ft (29.0 m of 4.01 g Au/t from 6.1 to 35.1 m) in silty carbonate rocks, above massive dolomite of the Lone Mountain Formation. Additional drilling in the vicinity of KR-001 intersected disseminated gold, including:

60 ft of 0.033 oz/t Au from 200-260 ft (18.3m/1.132 g Au/t from 61-79.3 m) in M-9
40 ft of 0.050 oz/t Au from 320-360 ft (12.2m/1.715 g Au/t from 97.6-109.8 m) in M-9
50 ft of 0.030 oz/t Au from 380-430 ft (15.2m/1.029 g Au/t from 116-131.1 m) in RED-11
50 ft of 0.014 oz/t Au from 150-200 ft (15.2m/0.480 g Au/t from 45.7-61 m) in RED-06

These holes define a northeast-striking zone of gold mineralization that remains open along strike.

Joint Venture Exploration

2005
Newmont completed geologic mapping, rock chip sampling, a 340 station CO2/O2 soil gas survey, and 13,115 ft (3,998.5 m) of reverse circulation drilling in 11 holes. Three holes, NRC-4, -5 and -6, identified a vertically-extensive hydrothermal/gold system below shallow drilling. Drill cuttings from NRC-4 contain deep oxidation, zones of moderate to strong decalcification and silicification, and breccia zones. The hole ended prematurely in the Denay Formation at 1,170 ft (356.7 m) in silicified and oxidized multi-lithic breccia with the following metal values: Au 170 ppb, As 123 ppm, Sb 75 ppm and Hg 7.5 ppm. The alteration in combination with elevated pathfinder metals confirms the presence of a deeper, previously unrecognized sediment-hosted gold system. This gold system remains open in all directions, particularly down section in the McColley Canyon Formation -- the host for gold mineralization at the Ice Prospect.

2007
Romarco completed 6,070 ft (1,850 m) of reverse-circulation drilling in eight holes. The holes tested geologic and soil geochemical targets. Results included 85 ft of 0.046 oz Au/t (25.9 m of 1.568 g Au/t) in drill hole ROM07-01 at the Ice Prospect. Romarco spent in excess of $500,000 on the project and terminated the exploration agreement in March 2008.

In plan, five drill holes at the Ice Prospect roughly outline a 195 ft by 820 ft (60 m by 250 m) zone of gold mineralization that remains open along strike to the northeast (Figure 3). The northeast exploration potential is supported by the five mineralized drill holes, surface rock chip sampling, structural contouring, gravity and a geochemical evaluation completed by specialist Robert Jackson. Additional drill targets have been identified.

Figure 3. Ice prospect drilling.

2008
Montezuma completed 1:2,000 geologic mapping over the northern half of the carbonate window; collected in excess of 2,000 soil samples; completed a detailed, property-wide airborne magnetic survey; and completed 13 CSAMT lines.

2009
Montezuma completed 2,295 ft (700 m) of reverse-circulation drilling in three vertical holes at the Ice prospect. Past exploration at Ice focused on gold-bearing and altered surface exposures of McColley Canyon Formation limestone, however past drilling did not step out to test open ended extensions to the northeast and southeast. The three holes (MR09-01, -02 and -03) evaluated a portion of the northeast potential, beneath younger volcanic rocks. Each hole intersected decalcified, silicified and oxidized rocks in the target zone with low-level gold, but failed to detect gold values exceeding 0.010 oz Au/t (0.343 g Au/t). Elevated arsenic, mercury, antimony and thallium are associated with zones of low-level gold. Montezuma's drilling indicates that a Carlin-style alteration system is present beneath barren volcanic rocks. Recent drilling results do not diminish the Ice target as exploration potential remains open to the northeast along 3,600 ft (1,100 m) of strike, and to the southeast for 7,600 ft (2,320 m) along a plunging syncline.

Geologic mapping at 1:2,000 was completed in the southern portion of the carbonate window. Property-wide mapping results include:

Refinement and reinterpretation of lower plate carbonate stratigraphy and the appreciation of favorable horizons for gold mineralization.
The recognition of a west-northwest striking fault-fold corridor developed in favorable lower plate carbonate rocks. Within the corridor, east-southeast plunging anticlines and synclines are present throughout the carbonate section (Figure 4). Previous drilling did not test favorable carbonate rocks within the folds particularly where they are cross cut by northeast and northwest-striking faults.
The recognition of the carbonate window in the hanging wall of the Wall fault. Map compilation and interpretation indicates the Wall fault is a normal fault with apparent right-lateral (wrench-style) displacement.

Miranda and Montezuma geoscientists peer reviewed the geologic mapping, soil geochemistry, CSAMT and airborne magnetic data collected by Montezuma over the past twelve months. Data were examined in plan and in a 3D-computer model. Results of the peer review included a new exploration model that will test for gold mineralization within plunging folds developed in the McColley Canyon Formation (Figures 5 and 6). A minimum of eight unique target areas were identified for additional field work and drilling.

Montezuma completed a three hole, 1,137 ft (346.6 m) diamond core drilling in November 2009. Drill holes MR09-05C and MR09-06C were designed to follow-up known gold mineralization at Red Canyon's Ice prospect and as such are not new discovery holes (Figures 3 and 7). MR09-05C verified the results in KR-001, a reverse circulation hole which intersected 95 ft of 0.117 oz Au/t from 20 to 115 ft (29.0 m of 4.012 g Au/t from 6.1 to 35.1 m), but with 30% higher grade (0.152 oz Au/t / 5.25 g Au/t) and 25% greater thickness (119 ft / 36.28 m) (Figure 5). MR09-06C intersected 60 ft of 0.10 oz Au/t (18.29 m of 3.43 g Au/t). MR09-04C had no significant assays. All drill results are based on a 0.010 oz Au/t (0.343 g Au/t) cutoff and represent drill indicated thicknesses.

Figure 4. Target and cross section locations.

Figure 5. Cross section A -- A'.

Figure 6. Cross section B -- B'.

Core samples from MR09-05C and MR09-06C indicate strongly decalcified and clay-altered limestone is associated with the gold alteration (Figure 8). As previous drilling targeted areas with strong silica alteration, this information will be valuable in effectively determining the location of future drill holes. Exploration potential at Ice remains open in two directions: to the southeast for 7,600 ft (2,320 m) along the axis of a plunging syncline; and to the northeast along 3,600 ft (1,100 m) of strike.

Figure 7. Core rig at the Ice Prospect.

Figure 8. Core photo from drill hole MR09-05C. The nine foot (2.7 m) interval from 64 to 73 ft (19.5 to 22.3 m) assayed 0.338 oz Au/t (11.6 g Au/t).

2010 Plans

To date, Montezuma's drilling has been permitted through a Notice of Intent (NOI) with the Bureau of Land Management. The NOI limits surface disturbance to a maximum of 5 acres (2 hectares). Currently, Montezuma and Miranda geologists recognize eight unique target areas that require multiple phases of drilling. To test these targets, Montezuma has initiated the permitting process for an Exploration Plan of Operations (POO). When complete, the POO will allow for more than 5 acres (2 hectares) of surface disturbance and increased flexibility in drill testing a variety of targets across the property.

Montezuma is in the process of compiling exploration data and selecting 2010 drill targets. As this process evolves and plans are finalized, additional information will be posted on this page.