VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/06/13 -- Banks Island Gold Ltd. (TSX VENTURE: BOZ) (the "Company") reports that as a result of a review by the British Columbia Securities Commission (BCSC), the Company is issuing the following news release to clarify our disclosure.
The Company is now filing amended technical reports on its Banks Island (Yellow Giant) and Red Mountain properties. An amended Banks Island report was required to carry forward a previous Preliminary Economic Analysis (PEA), to apply gold grade cutting to the Kim deposit, and to provide additional information required by NI 43-101 about assumptions, parameters, and methods used for resource estimates. There are no material changes to resources and no changes to the previous PEA in the amended Banks Island report.
The Red Mountain report required amendment to document a personal property inspection required by NI 43-101, and to provide additional information about assumptions, parameters, and methods used for resource estimates. There are no changes to the Red Mountain resource estimate and PEA in the amended Red Mountain Report.
Additional details about the amended reports are in following sections of this news release.
Clarification of Non-Compliant Disclosure by Fundamental Research Corp.
Fundamental Research Corp. (Fundamental) distributed a report dated November 5, 2012 (the "Fundamental Report"). Banks Island Gold has no control or influence over Fundamental. All reports prepared by Fundamental are the work and property of Fundamental and they bear the full responsibility for those reports. The Company cautions readers that the Fundamental Report is not complaint with NI43-101, for example it summarized the Company's PEA at Yellow Giant without disclosing the type of mining study (a PEA), and omitted mandatory cautionary language always required by NI 43-101 with disclosure of PEA results. In particular, the Yellow Giant PEA is preliminary in nature, is based on inferred resources that are too speculative geologically to have economic considerations applied that would enable them to be categorized as mineral reserves, and there is no certainty the PEA will be realized. Mineral resources that are not reserves do not have demonstrated economic viability.
The Fundamental Report also disclosed a change to parameters of the PEA, which the Company cannot support at this time. The company disassociates itself from this and other information in the Fundamental Research Report.
Clarification of disclosure in Corporate Website, Investor Presentation, and Factsheet
The Company's provides clarification of its December 2012 Investor Presentation (the "Presentation"), a Fact Sheet, and additional information on the Corporate website.
1. The Presentation disclosed a "mineable resource"; a class restricted under NI 43-101. The Company retracts the use of the term "minable resource" and has removed it from all materials.2. The Presentation included resource estimates not compliant with N43-101. To correct this, the Company has revised its mineral resource statements to always include classifications, disclose all classes of Mineral Resources separately, and not add inferred quantities to other classes.3. The Corporate Presentation disclosed a high-grade subset of the current Red Mountain resource estimate. This disclosure omitted resource classifications and was not supported by the current Technical Report. The Company retracts this high-grade subset resource estimate.4. The Company's website disclosed that the Yellow Giant Property has "potential for a major ore deposit" and provides a definition of a major ore deposit using a large gold ounce quantity. The Company retracts this gold ounce quantity, which did not comply with NI 43-101 rules for disclosure of a potential exploration target and is unsupported in the current Technical Report, and cautions that "a major ore deposit", may or may not exist on the Property.5. The company's Presentation also disclosed exploration potential at Yellow Giant using a large gold ounce quantity with a fixed gold grade, and by comparing it to a significant deposit in British Columbia. As previously indicated, the Company retracts prior disclosure of exploration potential on the Property, as it is unable to provide a basis for such estimates, and its disclosure failed to use ranges of grade and tonnes, and did not include cautionary language always required by NI 43-101 for potential exploration targets.6. The Presentation displays a graph displaying cashflows projected from the 2011 PEA study at Yellow Giant at various gold prices. The graph highlights cases with gold price higher that the PEA's $1360/oz base case, does not identify the base case, and does not equally present downside gold price risk. The Company retracts the information contained in this graph.7. The Company's December 2012 Factsheet (the "Fact Sheet") displays information form the 2011 PEA at a $1700/oz gold price, but omits the $1360/oz base-case of the PEA. The Company retracts this information and will provide balanced sensitivities around the base-case in future disclosure.8. A map showing historic production and current resources of various properties contained in the Company's presentation and Factsheet had an error which overstated the mineral resources at Red Mountain. The M&I resource at Red Mountain contains 435,000oz of gold and not 540,000oz as was shown in that figure. This error has been corrected.9. The resource table in the Presentation contained an error in the silver grade of the M&I resources for Red Mountain. The average silver grade of the M&I resources at Red Mountain is 29gpt Ag and not 39gpt Ag as shown in the table. This error has been corrected.