USEG - U.S. Energy Corp. Announces That Sutter Gold Intersects High-Grade Gold Mineralization
Thursday September 14, 7:18 pm ET
RIVERTON, Wyo., Sept. 14 /PRNewswire-FirstCall/ -- U.S. Energy Corp. (USE) (Nasdaq: USEG - News) announced that Sutter Gold Mining Inc. (TSX-VX: SGM) has today announced three new mineralized zones were intersected, plus significant extensions to four shoots hosting previously reported mineral resources were discovered.
Assay highlights were previously reported in an August 31, 2006 press release for Holes 163 through 167. Four of the first five holes targeted three known shoots within the 40 and 42 Veins. One of the first five holes (166) was unplanned and targeted the north strike extension of barren mineralization cut in the 31 Vein (Hole 163), which exhibited deformation of late porphyroblastic overgrowths, a feature which has proven to occur within approximately 10 meters of most oreshoots within the Comet Veins.
The three new mineralized zones are described as follows:
The first new discovery lies within a 200 foot long by 300 foot high area along the steeply-eastward dipping 20 Vein between cross-sections 2200N and 2400N, identified in Holes 164 (23.5 ft @ 0.207 oz/ton) and 165 (10.0 ft @ 1.208 oz/ton).
The second new zone is located within a 500 foot long by 100 foot high area in the 31 Vein between cross-sections 2200N and 2600N, which has been cut in Hole 166 (6.0 ft @ 0.275 oz/ton) between previous Holes 73 (5.0 ft @ 0.145 oz/ton) and 141 (6.0 ft @ 1.616 oz/ton).
The third zone is an estimated 110 foot strike length of mineralization in the 26 Vein, intersected in Hole 166 (9.0 ft @ 2.173 oz/ton), which is untested at depth along a 700 foot unexplored strike length.
Thus far, the step-out drilling has identified extensions to previously announced indicated resources in the 40, 42, and 44 Veins, and 42-47 Vein junction shoot. Mineralization in the 40 Vein shoot between cross-sections 2100N and 2400N has been extended an additional 40 feet up-dip along a 300 foot strike length. The 42 Vein shoot between cross-sections 2100N and 2400N has been extended an estimated 40 feet up-dip along a 250 foot strike length. The 44 Vein shoot between cross-sections 2100N and 2400N has been extended an estimated 50 feet up-dip along a 200 foot strike length. The 42-47 Vein junction shoot between cross-sections 1800N and 2100N has been extended an estimated 75 feet down-dip along a 250 foot strike length by Hole 167.
Holes 163 through 167 have continued to demonstrate excellent geological continuity along the veins of the Comet Zone and within the new shoots. Updated mineral resource estimates for these zones will be announced once duplicate fire assay results are obtained and grade continuity can be more firmly established. The geological interpretation for Holes 163 through 167 suggest the possibility that significant additions to the mineral resource base for the Comet Zone can be expected as the underground drilling program continues.
The Sutter Gold 2006 core drilling program is planned and supervised by Mr. Mark Payne, P. Geo. Calif. 7067, the Qualified Person for the Sutter Gold Project, as defined by NI 43-101, and has reviewed this release.
About the Sutter Gold Mine
The Sutter Gold project contains a 3.2-mile segment of the Mother Lode belt from which 10 historic mines produced 2.3 million ounces of gold. The historic mines bracket a one-mile-long portion of the Mother Lode belt with no historic gold production that contains the Lincoln and Comet zones. The Lincoln and Comet zones were "blind" discoveries that did not outcrop at surface and represent the first significant new gold discoveries made along the Mother Lode belt in the last 50 years. A total of 85,085 feet of drilling has been accomplished in 190 diamond drill holes, and modern underground development consists of a 2,850-foot declined ramp with 2,400 feet of crosscuts and five raises. The project has received all of the major permits required for production. The historic gold production was documented in a detailed report completed by Mark Payne, the consulting geologist to Sutter Gold.
U.S. Energy Corp. owns approximately 50% of the outstanding shares in SGM.
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For additional information on Sutter Gold, please visit
www.SutterGoldMining.com.
For U. S. Energy Corp., please visit: www.usnrg.com
ABOUT U.S. ENERGY CORP. AND CRESTED CORP.
U.S. Energy Corp. and its majority-owned subsidiary, Crested Corp., are engaged in a joint venture to conduct various business operations as USECC. Through their subsidiaries, Sutter Gold Mining Inc., Plateau Resources Limited, Inc., U.S. Moly Corp, U.S. Uranium Ltd. and USECC, they own various interests or properties prospective for gold, uranium, vanadium and molybdenum.
This news release includes statements which may constitute "forward- looking" statements, usually containing the words "believe," "estimate," "project," "expect," or similar expressions. These statements are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, future trends in mineral prices, the availability of capital, competitive factors, and other risks.
The profitable mining and processing of uranium and vanadium will depend on many factors: Obtaining properties in proximity to the Shootaring mill in southeastern Utah to keep transportation costs economic; delineation through extensive drilling and sampling of sufficient volumes of mineralized material, with sufficient grades, to make mining and processing economic over time; continued sustained high prices for uranium oxide and vanadium; obtaining the capital required to upgrade the Shootaring mill and add a vanadium circuit, and obtaining and continued compliance with operating permits.
The profitable mining and processing of gold will depend on many factors, including receipt of final permits and keeping in compliance with permit conditions; delineation through extensive drilling and sampling of sufficient volumes of mineralized material, with sufficient grades, to make mining and processing economic over time; continued sustained high prices for gold, and obtaining the capital required to initiate and sustain mining operations, and build and operate a gold processing mill.
We have not yet obtained feasibility studies on any of our mineral properties. These studies would establish the economic viability, or not, of the different properties based on extensive drilling and sampling; the design and costs to build and operate gold and uranium/vanadium mills; the cost of capital, and other factors. Feasibility studies can take many months to complete. We have not established any reserves (economic deposits of mineralized materials) on any of our uranium/vanadium or gold properties, and future studies may indicate that some or all of the properties will not be economic to put into production. The molybdenum property has had extensive work conducted by prior owners to establish the deposits of molybdenum, mine planning and other ancillary activities. This data will have to be updated to determine the viability of starting mining and milling operations. Obtaining mining and other permits to begin mining the molybdenum property may be very difficult, and, like any mining operation, capital requirements for a molybdenum mining operations will be substantial.
By making these forward-looking statements, the Companies undertake no obligation to update these statements for revision or changes after the date of this release.
DISCLOSURE REGARDING MINERAL RESOURCES UNDER SEC AND
CANADIAN REGULATIONS
USE is a joint venture partner with Uranium Power Corp. ("UPC") and a major shareholder of SGMI. The common stock of UPC and SGMI, both Canadian corporations, are traded on the TSX-V, and are subject to the reporting requirements of the TSX-V and Canadian securities regulatory authorities. Harold F. Herron, Senior Vice President and Director of USE and Crested, serves on the board of directors of SGMI and is also the Company's President and CEO and Chris Healey, Vice President Exploration of USE, serves on the board of directors of UPC.
From time to time, UPC and SGMI make public disclosures in compliance with National Instrument 43-101, "Standards of Disclosure for Mineral Properties." NI 43-101 establishes procedures and standards for determining the existence of, and the reporting of, Mineral Resources and Mineral Reserves. Mineral Resources are classified in ascending categories of geological confidence, as Inferred, Indicated, and Measured. Each definition relates to a resource that is determined to be of "such a grade or quality that it has reasonable prospects for economic extraction." Mineral Reserves are classified as Proven or Probable.
The SEC allows public disclosure of the extent and grade of mineral deposits, and, under SEC Industry Guide 7, "Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations, of Proven (Measured) Reserves and Probable (Indicated) Reserves. In contrast to NI 43- 101, the SEC does not allow public disclosure of Inferred, Indicated, or Measured Resources. In addition, there are some significant differences in the standards allowed, and the procedures required to be followed by the SEC for public disclosure of the SEC's Proven (Measured) Reserves and Probable (Indicated) Reserves, as compared to NI 43-101 for Proven and Probable Mineral Reserves."
United States residents, who obtain information about those of our uranium properties, and about the gold properties, which are reported upon by UPC and SGMI to the TSX-V in accordance with NI 43-101, and about SGMI's gold properties, are cautioned that such information may be materially different from what would be permitted under SEC rules for United States companies.
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Source: U.S. Energy Corp.
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