Hawthorne Gold Advances Toward
www.hawthornegold.com
Production at Cassiar
Richard Barclay
President & CEO
Since its formation in 2006, Hawthorne
Gold has moved ahead on several prop-
erty fronts, and is progressing towards
its goal of restarting production at its
wholly-owned Cassiar Gold Mine, a high-
grade, underground operation located
on Table Mountain in northern BC. Work
also continues at its Taurus Project, a
large-tonnage, low-grade gold deposit
which was a former high-grade producer
and could potentially be a source of
low-grade supplemental mill feed as the
Company moves towards production at
Cassiar. On its Frasergold JV property, also
in BC, 1.62 million ounces of inferred and
indicated gold have already been de-
fined, in a low-grade deposit which holds
potential for developing substantial
additional bulk tonnage. With this much
positive activity going on, we wanted to
get more details from Richard Barclay,
Hawthorne’s CEO, on where things go
from here with the company.
R
esource Intelligence: Richard, before we go
further, can you give us a little history on
Hawthorne and how it got to where it is
today?
Richard Barclay: Hawthorne Gold was formed in
January 2006 by Michael Beley and me. We had
previously been co-founders of both Bema Gold
and Eldorado Gold and have worked together
for years. Hawthorne went public in April 2007
with our main initial property interest at the
time being the Frasergold joint venture with
Eureka Resources. Then in December 2007
32
Booth # 3019
604.629.1505
Hawthorne entered into a merger agreement gold mineralization. Then in October 2007,
with Cusac Gold Mines Ltd., a past-producing before merging with Cusac, the operation and
company focused primarily on the Cassiar support facilities at the Cassiar Gold Mine were
Gold Property, a 175 square kilometre package shut down due to lack of economic ore at the
of mineral claims located in north central BC, prevailing gold price. In June 2009 we started an
hosting a number of gold assets. The key part of exploration/development program, with the goal
the Cassiar Gold Property, including the Taurus of working towards gold production. Ultimately,
Deposit is, of course, the fully permitted Cassiar in addition to the underground operations, we
Gold Mine located on see excellent potential
Table Mountain. As for open pittable gold
part of that trans-
action, Cusac Gold
“We have an experi- resources from several
locations on our prop-
Mines assigned all its enced management erty.
rights to its option
to acquire 46 mineral team with a record of RI: The other part of
your Cassiar Property
claims near Cassiar building previously is the Taurus Project.
from American Bon-
anza Gold Corp. That successful gold min- Tell us a little about
property covers the that.
majority of the Taurus ing companies.”
RB: Taurus is a large-
Deposit, the balance ~President & CEO Richard Barclay tonnage, low-grade
of which was held gold deposit and is
100% by Cusac Gold a former high-grade
Mines. gold producer which
RI: So after the Cusac merger, your main atten- has been explored for approximately 25 years.
tion turned to Cassiar and Table Mountain. Can As a former high-grade, small underground gold
you give us a little more detail on that project? mine, the Taurus deposit was actively operated
in the early 1950s and then again in the early
RB: Table Mountain gave us a project with an 1980s, with historical production of 32,700
already permitted 270 tonnes per day gravity/ ounces from high-grade zones within the deposit.
flotation mill, power plant, assay laboratory and The high-grade areas were eventually abandoned
tailings impoundment facility. Basically, it’s a and attention turned to a large low-grade min-
turnkey deal with 13 portals and adits, and about eralized zone, where approximately 370 holes
25 kilometres of underground workings access- have been drilled.
ing a number of gold mineralized zones. The
property is part of the historic Cassiar Gold Belt;
a 23 kilometre long greenstone hosted quartz car-
bonate formation that stretches from Mount Mc-
Dame in the north to Juniper Mountain in the
southeast. Nearly 500,000 ounces of gold have
been produced from all of the historic under-
ground mining operations and various mills in
the area as well as from placer operations along
the McDame River. The extensive high-grade
gold vein system at Cassiar is similar to some of
Canada’s largest gold camps, such as Timmins,
Kirkland Lake and Val d’Or.
RI: Why was the mine closed when you acquired
the deal?
RB: I’ll give you a little more background here.
Beginning in 1934 and in the years following,
there were many small mines in the area, which
processed high-grade ore. Then, with the rise in
the price of gold, larger-scale underground min-
ing and processing started in 1978, first as the
Erickson Gold Mine, then the Cusac Gold Mine.
During this period, mine operators opened 13
portals to access Table Mountain’s widespread
See page 96 for Disclosure, Disclaimers & Info on Mineral Resource and Reserves
Hawthorne Gold Corp.
-Continued
The project comprises wholly-owned mineral
claims and as well as the wholly-owned Taurus
II property, which has been drilled over the last
two years. This drilling expanded the mineraliza-
tion with grade intercepts in a range from 0.5 to
2.0 g/t gold. At this point it is an advanced-stage
exploration target with a 43-101 compliant in-
ferred mineral resource estimate of 1.055 million
ounces of gold which was confirmed in a March
2009 updated technical report. It consists of 33.1
million tonnes at an average gold grade of 0.99
g/t with a cut-off grade of 0.5 g/t. Our plans are
to review the current deposit and develop several
open pits in higher grade zones (3 grams and bet-
ter) within the existing resource as supplemental
mill feed as we move towards production at the
Cassiar Gold Mine.
Additionally Taurus has the potential to host a
multimillion ounce low-grade gold deposit. Con-
siderable effort over the last two years has been
rewarded with a much better understanding of
the genesis and structure of the sediment and
volcanic hosted gold mineralization. A significant
diamond drill program is planned to expand and
potentially upgrade this existing resource.
RI: And what’s the story on your original Fraser- RI: So, how are your finances and ability to raise
gold property? capital?
RB: Our Frasergold Property is located approxi- RB: Well, we just announced in January, and
Free Revolutionary Online Investment Calculators and all 43-101 data with sources and project values www.resourceintelligence.net
mately 100 kilometres east of Williams Lake,
BC. We have an agreement to acquire up to 60%
interest in the Frasergold Deposit itself from Eur-
eka Resources Inc. and up to a 70% interest from
Dajin Resources Corp. on surrounding claims. In
the early 1980s initial exploration defined a 10
kilometre long zone with anomalous gold values
obtained from soil and rock geochemical surveys.
A total of nearly 36,000 metres of drilling in 328
holes has been completed on the property, along
with nearly 300 metres of underground drifts to
provide access for bulk sampling and metallur-
gical testing.
Metallurgical tests were conducted during these
earlier programs on both surface and under-
ground bulk samples showing that 87% to 92%
of the gold is recoverable with a combination of
gravity separation and flotation. We completed
an independent NI 43-101 technical report dat-
ed November 15, 2009, which shows resources
of 219,418 ounces of gold in the measured cat-
egory, 392,541 ounces indicated and 1,228,457
ounces inferred. This property is really huge and
there is good potential for developing much lar-
ger tonnage along the whole mineralized zone.
Booth # 3019
www.hawthornegold.com
604.629.1505
expect to soon complete a $5.8 million special
warrant financing with China Mineral Hold-
ings Limited which we will be using for merger
and acquisition activities. The warrants convert
into units which carry additional warrants,
and if those are exercised within 18 months at
$0.39 per share, Hawthorne would receive an-
other $3.95 million. We are also in the process
of securing production financing for the Cassiar
Gold Mine.
RI: What would you like investors to focus on in
evaluating Hawthorne as a possible addition to
their portfolio?
RB: We have an experienced management team
with a record of building previously successful
gold mining companies such as Bema and El-
dorado. We have a gold mine that has the poten-
tial to go back into production that could pro-
duce future cash flow for the company. We have
ongoing exploration programs, which should be
producing positive news and adding tonnages to
our existing resources. There is always the possi-
bility of some sort of surprise good news, which
could provide excitement in the market. And
lastly, our stock is selling near the low end of its
range for the past two years, so we feel that it’s
a bargain, as do the investors in our last private
placement.
Milestones:
• Complete engineering and
mine planning this year toward
production at the Cassiar Gold
Mine
• Complete the production
financing for the Cassiar Gold
Mine this year
• Complete 10,000m surface drill
program to expand and poten-
tially upgrade existing Taurus
resource
33