Eagle Hill Third Quarter Financial Results
September 24, 2014 – Vancouver, BC – Eagle Hill Exploration Corporation (TSX-V: EAG, OTCQX: EHECF) (“Eagle Hill” or the “Company”) has released the results of its third quarter ended July 31, 2014. Details of the Company’s financial results are described in the unaudited condensed interim financial statements and Management’s Discussion and Analysis (“MD&A”), which are available on the Company’s website at www.eaglehillexploration.com and on SEDAR at www.sedar.com. All amounts are in Canadian dollars unless otherwise stated.
COMPARATIVE QUARTERLY RESULTS
The following table sets out selected financial information for the most recent eight fiscal quarters.
At September 23, 2014, the Company had working capital of approximately $1,960,000. For the three months ended July 31, 2014, the Company had a net and comprehensive loss of $546,507 or $0.001 per share (2013: $545,230 or $0.003 per share). At July 31, 2014, the Company had a commitment to spend a total of $72,000 on Canadian eligible exploration expenses by December 31, 2014 and $1,000,000 by December 31, 2015.
WINDFALL PROPERTY REVIEW AND OUTLOOK
The Windfall Lake Property covers approximately 12,400 hectares in the prolific Abitibi Greenstone Belt in Quebec. The property consists of 285 contiguous claims. Eagle Hill obtained ownership of the property by optioning different claim blocks from Noront, Murgor and Cliffs. On May 6, 2014, the Company announced that it had completed its purchase of three 2% NSRs related to Eagle Hill’s Windfall Lake Gold Project, which is located in the Abitibi Gold Belt approximately 200 km northeast of Val d’Or, Quebec. The Company paid a total of $60,000 and issued a total of 3,333,334 shares to purchase the NSRs, which cover 3,469.9 hectares of the 12,400 hectare Windfall Lake Property. The shares issued to the vendors of the royalties are subject to a four-month hold period.
On March 28, 2014, the Company completed the purchase of the 29 Claims and the 184 Claims immediately adjacent to the Windfall Lake Property. In consideration for purchasing the remaining interests in the 29 Claims and the 184 Claims, the Company paid $250,000 and issued 9.5 million common shares to each of the optionors. In addition, the Company granted a 0.5% NSR for the 29 Claims and a 1% NSR for the 184 Claims to each of the optionors. The Company retained the right to buy back any of the NSRs at any time prior to first commercial production by paying $500,000 to the holder of the NSR.
The Fall 2013 drill program achieved its primary objectives, confirming continuity of mineralization below Red Dog, confirming the extension of mineralization southwest of the Main Zone, and expanding both Zone 27 and the Mink Lens. In addition, a downhole IP survey showed additional potential below Red Dog. The Winter 2014 drill program was focused on testing for gold mineralization below shallow lakes in the Main Zone. A total of 3,333 metres was drilled in 16 drill holes. Several drill intercepts demonstrated the presence of pyritic stockwork similar to other lenses of the Main Zone. The results confirmed continuity of the Zone 27 gold mineralization and demonstrated lateral extension of the Zone. All drill results have been press released and are available on SEDAR at www.sedar.com and on the Company’s website at www.eaglehillexploration.com.
On August 5, 2014, the Company announced that it had commenced a 2,800-metre drill program targeting the extension of Zone 27 to the northeast below the Red Dog intrusion. Eagle Hill plans to deepen six existing drill holes in a target zone that is currently untested. Using existing holes to reach the target zone will reduce drilling costs and also allow the target zone to be reached more quickly. The Company also plans to complete a hole-to-hole IP survey to further define drill targets at depth. Geological studies indicate that the gold mineralization hosted by Zone 27 and the Caribou Zone may have been displaced to the NNE as much as 600 metres below the Red Dog dike, which coincides with an IP anomaly identified below Red Dog.
Preliminary Economic Assessment Study
On June 24, 2014, Eagle Hill announced plans to complete a PEA for the Windfall Lake Property. On September 17, 2014, the Company announced that work on the PEA is underway, with different components of the project awarded to three internationally recognized engineering firms: Tetra Tech, Inc.’s Canadian Mining Division, Soutex Inc. and SRK Consulting (Canada), Inc. The Board of Directors has appointed Paul-Henri Girard as the lead director to manage the PEA process, and engaged Jacques Gauthier as an engineering consultant to oversee the day-to-day logistics of the PEA and act as a technical liaison with the engineering firms. Mr. Girard is a Mining Engineer with extensive experience planning and operating Canadian mines. Mr. Girard held increasingly senior positions with Agnico Eagle over a 25-year period, eventually retiring from the position of Vice President Canadian Operations in 2012. Mr. Gauthier is a principal mining engineer with over 30 years of experience. As chief engineer and project manager, Mr. Gauthier has participated in many mine expansions and development projects and has managed feasibility and prefeasibility studies for projects in Ontario, Quebec and Burkina Faso.
On Behalf of the Board of Directors
Interim Chief Executive Officer
About Eagle Hill Exploration Corporation
Eagle Hill Exploration Corporation is a Canadian mineral exploration company focused on the exploration and development of the high-grade Windfall Lake gold deposit, located between Val-d’Or and Chibougamau in Quebec, Canada. The current mineral resource comprises 2,375,000 tonnes at 9.75 g/t gold (744,000 ounces) in the indicated category and 3,084,000 tonnes at 7.37 g/t gold (731,000 ounces) in the inferred category (Technical Report for the Windfall Lake Gold Project, Quebec prepared by SRK Consulting (Canada) Inc., dated March 3, 2014). These grades make Windfall Lake one of the highest grade resource-stage gold projects in the world. The bulk of the mineralization occurs in the Main Zone, a southwest/northeast trending zone of stacked mineralized lenses, measuring approximately 600 metres wide and at least 1,400 metres long. The deposit remains open at depth and along strike, with additional drilling and technical work planned for 2014. A Preliminary Economic Assessment Study for the project is underway, with completion targeted for Q1-2015. More information is available at www.eaglehillexploration.
Eagle Hill Contact
Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward-looking Statements
This document contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation (collectively “forward-looking statements”). The use of any of the words “will”, “plans”, “objective”, “expand”, “potential” and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such forward-looking statements should not be unduly relied upon. This document contains forward-looking statements and assumptions pertaining to the following: uncertainty involving resource estimates and the ability to extract those resources economically, or at all; uncertainty involving drilling programs and the Company’s ability to expand and upgrade existing resource estimates; the regulatory process and actions; the need to work with local communities and authorities to advance the properties; the need to work with Dundee and Southern Arc to advance the property; technical issues; new legislation; competitive factors and conditions; uncertainties resulting from potential delays or changes in plans; the occurrence of unexpected events; and the Company’s ability to execute and implement future plans. Actual results achieved may vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors, including uncertainty related to drill results and the inclusion of drill results in future resource estimates for the property. The Company believes the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct.
The technical information in this document has been reviewed by Eagle Hill’s Vice President Exploration, Jean-Philippe Desrochers, PhD, PGeo, who has sufficient experience relevant to the style of mineralization under consideration and qualifies as a Qualified Person as defined by National Instrument 43-101. The drill program and sampling protocol is managed by Eagle Hill under the supervision of Jean-Philippe Desrochers. The diamond drill holes are drilled at NQ sizes and core recovery to date has averaged better than 95.0%. Half core is cut by rock saw and is generally sampled using nominal 1-metre intervals; however, sample intervals vary according to geological contacts and have ranged between 0.3 to 1.5 metres in length. Two quality control samples (one blank and one certified reference material) are inserted into each batch of 20 samples. All assays were performed by ALS Chemex Laboratory Group, in Val d’Or, Quebec. The half core samples are securely transported from the project site to the ALS Chemex laboratory by Eagle Hill personnel. Gold analyses reported in this release were performed by standard fire assay using a 30-gram charge with atomic absorption finish and a gravimetric finish for assays greater than 10 grams per tonne and by metallic sieve method for samples containing significant amounts of pyrite or visible gold. In addition, an Aqua regia digestion with ICP-AES finish is used to analyse a full suite of elements including silver and base metals.