Highland Resources announces start of drilling campaign on the Keweenaw Copper Project in Michigan, USA
Initial drilling to target high grade near-surface chalcocite zones
July 23, 2012 - Vancouver, British Columbia -- Highland Resources Inc. (TSXV: HI) ("Highland" or the "Company") is pleased to announce that, following the recent amendment to its Mining Venture Agreement with BRP LLC and Keweenaw Copper Co. (the "Agreement") and the completion of a $16.5 million private placement, the Company has started a drilling program on the Keweenaw Copper Project in northernmost Michigan. Two drills are already on site.
From about 1850-1968 the Keweenaw Peninsula produced 5.4 million short tons of copper, mostly as native copper concentrated in the tops of basalt lava flows and within interbedded conglomerates. For a long period this area produced over 80% of all copper consumed in the USA. Sulfide minerals were rare in the native copper ores, but in the 1960s primary chalcocite mineralization, also in basalt flow tops, was discovered in a 20 mile long belt east of the native copper mines. Chalcocite is a copper sulfide containing about 80% Cu. Follow-up exploration drilling located numerous zones of chalcocite mineralization of potential economic interest, but low copper prices discouraged additional exploration.
One zone of chalcocite, the 543S sulphide deposit, was explored with 101 diamond drill holes from 1973-1977 and is the most advanced mineralized zone. The 543S deposit contains a historic resource estimate of 4.5 million short tons averaging 2.27% Cu at a 0.75% Cu cutoff grade as described in a Technical Report by Behre Dolbear & Company, Ltd. titled "Centennial and Kingston Native Copper, 543S, and Other Copper Sulfide Properties, Houghton and Keweenaw Counties, Michigan, USA'' dated September 29, 2011. This estimate is not compliant under NI 43-101 guidelines and must not be used to evaluate economic viability. The Company is not treating the historical estimate as current mineral resources or mineral reserves. Small amounts of native copper and native silver are also present. The historical resource estimate is contained in six separate zones averaging 16 ft. true thickness that are inclined to the north at about 40 degrees. Several of these zones come to the bedrock surface under unconsolidated glacial deposits that are 10-100 ft thick. Oxidation is shallow due to recent glaciation. The chalcocite zones have a low total sulfide content and the wall rocks contain abundant acid-consuming minerals.
The Company's objective is to complete approximately 100 diamond drill holes to confirm the size and grade of the non-compliant 543S historic resource estimate by the end of 2012. Resource modeling will begin in early 2013 if justified. At least five additional, incompletely drilled chalcocite zones are now targeted for drilling immediately following work on the 543S zone. Numerous unexplored copper-in-soil anomalies from the 1970s exploration work in the Chalcocite Belt will also be evaluated for initial drilling, in addition to more broadly-based geophysical studies.
Ross R. Grunwald, the Company's VP Exploration stated, "This project combines the unusual opportunity to confirm non-compliant historic results on a well-drilled high-grade chalcocite deposit with exploration drilling on numerous incompletely or undrilled deposits that, if successful, provide considerable upside potential in a relatively short period of time in a major mining district that has been largely ignored for the past 35 years."
Pursuant to the amended Agreement, the Company has the right to earn up to a 65% interest in Keweenaw Copper Project covering about 13,000 acres of mineral rights for consideration of US$750,000 cash, 1,000,000 common shares of the Company, and US$11,500,000 to be spent on a development and exploration program on the project by October 26, 2015. At the end of the earn-in period and as a condition to earning its 65% interest, Highland is required to produce a feasibility study to be prepared by an independent consultant selected by the management committee.
For more information about the Keweenaw Copper Project, please refer to the Behre Dolbear's NI 43-101 Technical Report, available on the Company's website at www.highlandresources.ca and on SEDAR at www.sedar.com.
The technical information contained in this release has been reviewed and approved by Ross R. Grunwald, PhD., Vice president - Exploration for the Company. Dr. Grunwald is a qualified person as defined by NI 43-101.
Certain statements contained in this press release constitute forward looking information under the provisions of Canadian provincial securities laws. Words such as "anticipate", "expect", "believe", "estimate," forecast, "planned", "will", "should", "could", "likely", objectives and similar expressions are intended to identify forward-looking information. Such statements include without limitation: the Company's exploration plans and objectives to confirm the historic resource estimate and complete a resource modeling; and other statements and information regarding anticipated results regarding the Company's operations and exploration. Such statements reflect the Company's views as at the date of this press release and are subject to certain risks, uncertainties and assumptions, and undue reliance should not be placed on such statements. Actual results may be materially different from those current anticipated. Many factors, known and unknown, could cause the actual results to be materially different from those expressed or implied by such forward looking statements. Such risks include, but are not limited to: the volatility of copper price; the uncertainty of exploration results, capital expenditure requirements and other costs; the uncertainties related to the Company's ability to acquire an interest in the Joint Venture Agreement, currency fluctuations; the availability of financing for additional capital requirements, cost of exploration and development programs; mining risks; risks associated with foreign operations; governmental and environmental regulation; and risks associated with global economic growth. The Company does not intend, and does not assume any obligation, to update these forward-looking statements and information, except as required by law. Accordingly, readers are advised not to place undue reliance on forward-looking statements.
Highland Resources is a Canadian exploration company focused on exploring and developing copper projects in the "Copper Country" of the Keweenaw Peninsula within the Upper Peninsula of Michigan, U.S.A. through its 100%-held subsidiary, Keweenaw Copper Co. The Company is well funded having completed a $16.5 million private placement in May 2012. The common shares of Highland trade on the TSX Venture Exchange under the symbol 'HI'. Additional information about the Company is available on the Company's website and on SEDAR.
For further information, please contact:
Ross R. Grunwald
Vice president - Exploration
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.