VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/08/13 -- Banks Island Gold Ltd. (TSX VENTURE: BOZ) (the "Company") is pleased to report an update of its recent developments, activities, and exploration plans for the Yellow Giant Gold Property, located on Banks Island, British Columbia.
Banks Island Maintains 100% Ownership of Yellow Giant
As announced on November 9, 2012, the Company provided formal notification to Selkirk Metals Corp. ("Selkirk"), a subsidiary of Imperial Metals Corporation, of the Company's intention to put the Yellow Giant Gold Property ("Yellow Giant" or the "Property") into commercial production. The Company has now received formal notification that Selkirk will not exercise its Back-in Right to acquire a 51% interest in Yellow Giant. The Company now has until August 4th, 2014 to secure financing and commence construction of the production facilities, at which point the Back-in Right will be permanently extinguished.
Selkirk continues to be a major shareholder in the Company and currently owns approximately 5% of the issued and outstanding common shares of the Company and retains a 2% NSR royalty on Yellow Giant.
Yellow Giant Exploration Program
The Company is pleased to announce that it has commenced mobilization and preparation for an aggressive exploration program at Yellow Giant. The Company plans to conduct a 35,000m drill program with the goal of significantly expanding the current mineral resource by testing high priority targets across the Property.
The Company has mobilized a 35 man floating accommodation camp to service the Property. The Company is leasing a floating accommodation barge rather than purchasing the barges discussed in the news release dated October 25, 2012. The Company has also mobilized a road building contractor to site. The contractor will be tasked with the building of exploration roads from the Tel Zone to the Bob, Kim, and Discovery Zones.
In order to achieve maximum cost efficiencies, the Company is purchasing its own diamond core drill and use Company employed diamond drillers. Exploration diamond drilling will be done on a full time basis commencing in March. Ongoing road building will provide accessibility over the Yellow Giant Property and allow expanded and cost-effective exploration activities.
The Company's exploration program, including camp services, road building, and exploration diamond drilling, is fully funded by existing working capital.
Yellow Giant Development Program
The Company is involved in discussions with multiple parties in order to secure further project financing for the Yellow Giant Gold Project. The Company submitted applications for a British Columbia Mines Act Permit and an Environmental Management Act Permit for a 200tpd underground mine at the Tel Zone on January 23, 2013.
The Company has commenced the refurbishment of its Dense Media Plant, currently located in Lindsay, Ontario. Refurbishment work includes conveyors, chutes, bins, controllers, piping, and electrical. The Company has been working closely with its metallurgist, engineers, and project manager to refine the process flowsheet, mechanical equipment, and process plant design. The Company plans to source and utilize high-quality used or refurbished equipment for the primary machinery of the process plant. Major equipment for the plant has been selected and will be purchased once the Company secures project financing.
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