Houston Lake Reports 2nd Quarter Results
Houston Secures $10 Million Financing Commitment and Discovered New Robertson Gold Zone
?Sudbury, Ontario – November 30, 2010 – 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. Yesterday HLM filed its report for the second quarter, and six months ended September 30, 2010.
Second Quarter Highlights:
HOUSTON SECURES $10 MILLION FINANCING COMMITMENT
•On September 22, 2010 Houston entered into an agreement providing for an Equity Line Facility ("ELF") with Dutchess Opportunity Cayman Fund Ltd., a fund managed by Dutchess Capital Management, II LLC. Under the terms of the ELF, Dutchess has committed to provide up to $10 million of capital during the next three years, at HLM’s discretion, through the issue of common shares. HLM will file an annual information form (“AIF”) and short form prospectus in Canada, which will be subject to the required corporate and regulatory approvals, including that of the TSX Venture Exchange and the Ontario Securities Commission. An AIF was filed with SEDAR on November 22, 2010 or can be viewed at www.houstonlakemining.com
HOUSTON DISCOVERS NEW GOLD ZONE
•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 WC10-01 was released in Q2 and it showed great potential for both width at 42 metres, and also bodes well for higher grade potential intersecting .6 metres of 6.56 g/t.
•Ongoing exploration efforts including sampling and assessment/planning for Q3 winter drilling to extend the strike length and test the mineralization at depth.
•Further drilling is independently recommended.
DUBENSKI GOLD ZONE (“DBGZ”)
•Completed a Phase V “Dubenski Exploration”, 4 hole, 1,600 meter diamond drilling program on the property to partly test the down dip and down plunge of the zone as well for future downhole geophysical testing in order to aid our interpretation and targeting efforts of the Zone.
•We have encountered several intersections bearing anomalous gold values with the deeper drilling on Dubenski Gold Zone, specifically with hole DB10-98 where the best intersection was 11 metres of 0.824 g/t gold. Holes 97 and 98 have provided us with the indications of mineralization down to a depth of approximately 450m from surface.
•Analysis is underway in order to perform downhole geophysical surveys with these holes. Additional to exploration efforts at depth lies the necessity to increase the resource on the Dubenski Gold Zone via infill drilling and possible strike length extension.
EXPLORATION EFFORTS ON WEST CEDARTREE
•A systematic grab sampling program commenced at the end of September designed to test known geophysical anomalies that have never been investigated on the West Cedartree Gold Project.
FINANCE
•Houston issued 1,666,667 Flow-Through Units priced at $0.15 per unit for gross proceeds of $250,000 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 period. With the $10 Million financial commitment from Dutchess, HLM will be positioned with exceptional access to funds, numerous exploration targets built on historic and NI 43-101 resources, and experienced 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 build economic ounces as fast as possible as Northwestern Ontario’s gold exploration is being brought to attention by corporate consolidation and exploration successes of many gold exploration companies as of late. Approximately 6,000m of drilling has been conducted specifically on the Dubenski Gold Zone since the last resource calculation was conducted approximately one year ago. By next spring we plan on updating our resources and are currently analyzing all six known gold zones and their resource potential in order to guide future drilling.”
The current program on the West Cedartree property is aimed at outlining three working areas (Dubenski Gold Zone, Robertson Gold Zones, and Dogpaw Gold Zones) in order to advance the company towards its production objective. To date almost all drilling on the project has been near surface and all resources remain open.
Exploration outlays, salaries and other outlays were funded from treasury. During the six months ended September 30, 2010 Houston invested $511,834 in the mining properties. A total of $411,769 was spent in acquisition and exploration costs for the Dubenski property. A total of $92,060 was spent on exploration for the West Cedartree property (specifically on the newly discovered Robertson Gold Zone) and $6,740 was incurred on the Pakeagama Lake Rare Metals Project.
Expenses for the six months ended September 30, 2010 were $238,150 compared to $287,498 for the same period of the previous year. HLM maintained a higher level of productivity on the West Cedartree Property as the previous year’s quarter, despite this decrease.
For the six months ended September 30, 2010 Houston incurred a net loss of $238,150 ($0.006/share) compared to a net loss of $293,954 ($0.009/share) for the same period ending in 2009.
The Company’s current rate of cash consumption, excluding expenditures on work programs, is approximately $30,000 per month.
OUTLOOK
Houston will continue to focus on exploration and development of the WCGP.
Houston Lake will focus on implementing the recommendations of the NI 43-101 report to further test the 1.7km long Dubenski Gold Zone along strike and at depth beneath the Dubenski gold resource. Current planning is underway in order to perform down hole geophysics in order to aid targeting at depth on the Dubenski Gold Zone. A winter drill program will be done on the Dubenski and will include some testing at depth based on down hole geophysical results and infill drilling required in order to update the resource estimate on the gold zone. During the six months ending September 30, 2010, 1500 metres has been drilled on the Dubenski Property and 1000 metres has been drilled on the newly discovered Robertson Gold Zone.
We have initiated investigation of surface targets at Dogpaw and along the Angel Hill gold trend especially in the vicinity of the Robertson Gold Zone. More specifically we have discovered geophysical analysis and grab sampling that the offset extensions of the Robertson Gold Zone provide for a minimum of 250m of strike length. Diamond drilling is currently being planned for January 2011 in order to further define the potential size of the mineralized zone.
The company expects to do future drilling on the McLennan in order to duplicate historical drilling and trenching done there and to justify a resource calculation. The Angel Hill gold zone data is currently being explored in order to upgrade the historic resources there, and to increase resource potential for the WCGP. Houston Lake’s overall goal is to identify enough resources at six possible locations (Dubenski, Angel Hill, Dogpaw Mineralized Zones, Robertson, and McLennan gold zones) in order to justify production or economically construct a mill facility on site.
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 44,164,304 common shares issued and outstanding exclusive of the announced financing. For additional information, please visit us at www.houstonlakemining.com.
Company Contacts
Houston Lake Mining
Trevor R. Walker, MBA
President
Tel: 705.897.7622
Fax: 705.897.7618
Forward-looking Statements
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. This release includes certain statements that may be deemed “forward-looking statements”. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, Investors should review the Company’s registered filings what are available at www.sedar.com.
