(PINK:HLKMF)(TSX.V:HLM) Houston Reports Fourth Quarter Results
Houston Lake Mining Inc. (TSX.V: HLM), is an advanced exploration company which has prospected and strategically acquired contiguous gold properties in Northwestern Ontario with the objective of transitioning into production. HLM also seeks platinum group and rare metal deposits in Northwestern Ontario. Today, HLM filed its report for the fourth quarter, and year ended March 31, 2011.
Year End Highlights:
HOUSTON APPOINTS MARIAN (MIKE) KOZIOL (P.GEO) AS NEW BOARD MEMBER
• On January 27, 2011 Houston announced the appointment of Marian (Mike) Koziol, P.Geo to the board of directors. Mr. Koziol serves as the President and Director of Alto Ventures Ltd. and resides in Sudbury, Ontario. Alto Ventures Ltd. (Alto) is a Canadian gold exploration company with projects in Ontario, Quebec, Manitoba and British Columbia. Mr. Koziol is a geologist with 32 years of experience exploring for gold and base metals in the Canadian Shield. He played key roles in a number of gold and base metals discoveries during his career with Saskatchewan Mining Development Corporation and Cameco Gold Inc. (CGI), including the McIlvenna Bay Copper-Zinc deposit, Saskatchewan, and the Comtois and Destiny gold deposits in Quebec. During his tenure as District Geologist from 1996 to 2002, Mr. Koziol was responsible for all exploration activities carried out by CGI in Eastern Canada, where he evaluated, acquired, and managed a number of multimillion dollar gold exploration projects in Manitoba, Ontario and Quebec. While at Alto Mike has acquired a number of high potential gold projects in Quebec and Ontario and is working to advance them.
HOUSTON ANNOUNCES ACQUISITION OF RARE METALS PROPERTIES, INCREASING THE SIZE OF THE COMPANY’S PAKEAGAMA RARE METALS PROJECT IN NORTH WESTERN ONTARIO
• On January 18, 2011, Houston announced the execution of an option of prospective and adjacent rare metal properties in order to substantiate the Company’s controlled land position and size of the Pakeagama Rare Metals Project located in the Red Lake Mining District of northwestern Ontario, Canada. Houston Lake now holds a 100 percent interest in 1,024 hectares (2,530 acres) of mining claims at its Pakeagama Rare Metals Project. This land position covers all known exposures of the Pakeagama rare metals pegmatite. All four properties are subject to a 2.5 percent Net Smelter Royalty ("NSR").
HOUSTON DISCOVERS NEW GOLD ZONE AND INTERSECTS FURTHER MINERALIZATION
• In August, HLM reported the results of 100 channel samples taken from 22 lines of surface exploration work which identified a potential new Robertson gold mineralized zone. The best sample result was 2.97 g/t Au over a length of 0.43 meters from Line 14. This interval was from a longer sample of 1.22 meters averaging 2.13 grams per tonne.
• In September, HLM commenced a Phase I, 1000 meter, 8 hole Robertson Prospect Exploration drill program.
• Drill hole WC10-05 intersected 22.60 Metres of 2.047g/t Gold Including 4.30 Metres of 4.740 g/t. Further drilling is independently recommended and commenced on the zone in April 2011.
HOUSTON EXTENDS MCLENNAN GOLD ZONE TO 450M OF MINERALIZED STRIKE LENGTH
• In March, HLM commenced a drill program on the historic 260m long McLennan Gold Zone. The best hole was WC-11-45 where it intersected 2.54 g/t gold over 4.9 m including 7.43g/t over 0.7 m near surface.
• Surface work by HLM in 2010 resulted in the discovery of a 10.79 g/t gold grab sample. The surface sample was taken 2.5 km southwest of the McLennan Gold Zone in an unexplored area near the same mafic-gabbro contact as the McLennan Gold Zone. This is a very positive indicator that this sheared contact area is a favourable target for gold and there is an impressive 6.6 km of geology to explore on strike to the north and south of the present-day McLennan Gold Zone.
FINANCE
• Houston issued 2,143,333 Units priced at $0.15 per unit for gross proceeds of $321,500 through a non-brokered private placement.
“We have taken logical steps in our corporate affairs and in our exploration efforts, specifically on the West Cedartree Gold Project during this rebuilding period. HLM continues to work towards being positioned with access to funds, developing numerous exploration targets built from historic and NI 43-101 resources, and adding experienced directors and management in order to properly guide HLM’s growth initiatives.” said Trevor Walker, President of Houston. “The current goal on the West Cedartree Gold Project is to identify the resource potential based from six known gold zones as fast as possible with the goal of then building economic ounces through guided drilling. Further attention is being brought to our project as Northwestern Ontario’s gold exploration is quickly being an exploration focus due to other corporate consolidation and exploration successes of many gold exploration companies as of late, more specifically Coventry Resources Limited’s Cameron Gold Deposit which is in excess of one million ounces and is located approximately 12 km away.”
“Strong market interest in rare metals has made our Pakeagama Rare Metals Project the chief focus of a staking rush north of Red Lake,” said Trevor R. Walker, President. “We believe that we hold the key ground identified by the Ontario Geological Survey (OGS) in their 1998-1999 rare metals evaluation of the region and are happy to have optioned grounds that strongly suggest the extension of the known mineralized pegmatite. High grade cesium, tantalum, rubidium and lithium oxide values have been reported in the Core Zone of the exposed pegmatite which is open in all directions on our project.”
Exploration outlays, salaries and other outlays were funded from treasury. During the twelve months ended March 31, 2011 Houston spent a total of $938,735 in the mining properties. A total of $414,447 was spent in acquisition and exploration costs for the Dubenski property. A total of $481,890 was spent on exploration for the West Cedartree Property (specifically on the newly discovered Robertson Gold Zone, and McLennan Gold Zone) and $8,593 was incurred on the Pakeagama Lake Rare Metals Project.
Expenses for the twelve months ended December, 2010 were $895,057 compared to $589,397 for the same period of the previous year.
For the twelve months ended March 31, 2010 Houston incurred a net loss of $854,701 ($0.02/share) compared to a net loss of $325,968 ($0.01/share) for the same period ending in 2010.
The Company’s current rate of cash consumption, excluding expenditures on work programs, is approximately $55,000 per month.
OUTLOOK
Houston will continue to focus on exploration and development objectives of the WCGP with a secondary focus on the Pakeagama Rare Metals Project:
West Cedartree Gold Project
During the twelve months ending, 1500 metres have been drilled on the Dubenski Property, 1000 metres has been drilled on the newly discovered Robertson Gold Zone, and 1308m has been drilled on the historic McLennan Gold Zone. In March 2011, a phase II, 1,214m drill program commenced on the Robertson Gold Zone.
We have initiated investigation of surface targets at Dogpaw and along the Angel Hill gold trend, more specifically in the vicinity of the newly discovered Robertson Gold Zone.
HLM has recently been making progress on the Dogpaw Lake Gold Zone by compiling and reviewing the data from previous management on the known gold-bearing veins. Of note, approximately 75% of drilling conducted by HLM has intersected values of 3 g/t or higher including the best drilled intercept yielded from drill hole DP07-42 with 7.5 meters of 29.9 g/t gold. High grades, and close proximity to the underexplored contact between the large gabbro body and volcanics provide an impressive 4.6 km of geology to explore on to the north and south of the present-day Dogpaw Gold Zone and makes it another key exploration target. In 2010 HLM reported up to 105 g/t gold from channel sampling in vein No. 5 on the Dogpaw Lake Gold Zone. The Dogpaw Vein No. 5 occurs 470 meters north-northeast of Vein No. 1, and occurs in the same gabbroic host rocks as the Vein No. 1, No. 2, No. 4 and No. 6 gold mineralizing system. Currently we are prospecting the Dogpaw with the intent of quickly conducting a trenching program to reveal the surficial relationship between the various known high grade veins on the property. Dependent on results, we will be quick to follow up with washing and channel sampling with the objective of a delineation program to at least continue with the existing targets based on past drilling on veins No. 1 and No. 2 and the immediate attention of vein No. 4 and others that may arise from our current work.
We currently have two NI 43-101 compliant resources on two of our gold zones (Angel Hill and Dubenski) and a historical resource on a third (Dogpaw Lake Mineralized Zones). In 2010 we focused a good portion of our drilling on the Dubenski Gold Zone. We initiated and completed phases IV and V of drilling which was aimed at expanding the resource along strike and at depth. Our drilling confirmed the extension of the Dubenski Mineralized Zone and proving that the Shaft, Central and East Zones form a continuous gold mineralizing system. The drilling also extended the gold mineralization to over 465 metres of strike length. We have encountered mineralization at a depth of 450m vertical, this is encouraging, despite encountering some cross faulting on the western extension of the zone. We have accomplished approximately 6000m of drilling since our last resource calculation, and are working on 3D modelling to aid in the next exploration holes to be done on strike, rather than expensive, deep drilling before we look at updating the resource there.
Houston Lake’s overall goal is to identify enough resources at six possible locations (Dogpaw, Dubenski, Angel Hill, Robertson, and McLennan gold zones) in order to justify production or economically construct a mill facility on site.
Pakeagama Rare Metals Project
Exploration Plans for 2011 include a summer Mobile Metal Ion (MMI) geochemical survey. The objective of this program is to aid in the targeting and planning of a Phase I winter diamond drill program. Upon completion of the MMI survey and the Phase I diamond drill program, the knowledge gained should allow us to have a rare and exclusive geochemical survey tool we can use in the exploration for rare-metal pegmatites in northern Ontario. In order to significantly reduce the costs associated with a helicopter supported summer drill program, HLM is planning on drilling Phase I in the winter months of 2012 and accessing the project utilizing the winter road network that runs within 6 kilometres of the project.
About Houston Lake Mining Inc.
Houston Lake is an advanced, vertically integrated resource exploration company. The Company is actively exploring for gold, platinum group metal and rare metal deposits in Northwestern Ontario with a strategic focus on the West Cedartree Gold Project. Houston Lake’s objective is to become a gold producer by surface mining its West Cedartree Gold Project and developing its 100% owned and optioned properties. The Company has a total of 49,532,637 common shares issued and outstanding exclusive of the announced financing. For additional information, please visit us at www.houstonlakemining.com
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