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Summit Project
The Summit Project is located along the northeastern flank of the Pequop Range, approximately 14 miles (22 km) east of Wells, Nevada and strategically positioned along strike and approximately 4,000 feet (1.2 km) from the northern end of the Long Canyon gold deposit of AuEx Ventures, Inc. and Fronteer Development Group Inc. where ongoing drilling continues to confirm the presence of high-grade oxide gold mineralization. The Summit Project is also in close proximity to AuEx's and Agnico-Eagle Mines' West Pequop gold project.
The Summit claims are staked in an area of Nevada known as the "checkerboard" where every other square mile is private; therefore Columbus Gold's claims cover the intervening federal lands, between the private parcels.
Subject to third party net smelter returns royalties, the Summit Project is 100% controlled by Columbus Gold and has been optioned to Agnico-Eagle. Agnico-Eagle can earn an initial 51% interest in Summit by incurring exploration expenditures totaling US$3 million over a five year period.
Geology
The claims were staked by Columbus in response to the November 2005 announcement of the discovery drill holes of good grade, Carlin-type gold mineralization, by AuEx Ventures, Inc., at their nearby Long Canyon Project. Columbus Gold's claims are positioned to cover either outcropping Lower Paleozoic sedimentary rocks similar to the host rock at Long Canyon, or shallow pediment along strike of structures trending to the Long Canyon area.
Past Work
Columbus is not aware of any prior exploration activity at Summit prior to the staking of the property in 2005. The property was optioned to Agnico-Eagle in 2007 and their work during the 2007 and 2008 field seasons was primarily directed at the interpreted strike extension of the Long Canyon deposit mineralization.
Agnico-Eagle performed geological mapping, collected 2,500 soil samples and 70 stream sediment samples, and completed seven rotary holes totaling 6,040 ft (1,830 meters) in their initial drilling program completed in December 2008.
One hole tested the Upper Paleozoic section-equivalent to the Pilot and Joana Formations, known to be favorable for Carlin-style gold deposits regionally. These favorable rocks are extensive, but almost everywhere covered by alluvium. The drill hole encountered multiple, thick sections (up to 100 ft (30 m)) of anomalous gold and arsenic both in the Upper Paleozoic section and in the underlying Guilmette Formation carbonate rocks, with a high assay of 203 ppb over five feet (1.5 m). This was the only drill hole to test this stratigraphic horizon in the Northern Pequop Range, which deserves considerable attention for further work.
Three holes tested geochemical anomalies near a thrust fault juxtaposing Devonian Guilmette Formation and Permian sedimentary rocks. Two of these holes encountered anomalous gold and lead in multiple zones over thicknesses of 75-100 ft (23-30 m). The gold values ranged from 10-122 ppb.
The other three holes were located near the eastern range front, north of the Long Canyon discovery. These holes cut Lower Paleozoic formations and intersected scattered weakly anomalous gold over narrow intervals.
Planned Program
Agnico-Eagle has advised Columbus Gold that it intends to continue with its option to earn an interest in the Summit Project and with plans to carry-out additional exploration expenditures during the 2009 field season.
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