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April 10, 2014 --- Vol. 08, No. 15April 2014

British Columbia (continued)

COPPER/GOLD/MOLY – Thompson Creek Metals Company Inc. April 9 reported production results for the three months ended March 31, 2014 for its three operating mines, Mt. Milligan, Thompson Creek and Endako. Total concentrate production for Mt. Milligan for the quarter ended March 31, 2014 was 22.2 thousand dry metric tons, which contained 14.2 million pounds of payable copper and 39.2 thousand ounces of payable gold. Molybdenum production for the first quarter of 2014 was 7.9 million pounds. Thompson Creek began the commissioning and start-up phase of Mt. Milligan in the fourth quarter of 2013, and Mt. Milligan Mine reached commercial production, defined as operation of the mill at 60 percent design capacity mill throughput for 30 days, as of Feb. 18. The ramp-up at Mt. Milligan continues to advance with mine pit grades as expected, metal recoveries in the mill currently above expectations and mill throughput steadily improving. The company continues to expect that mill throughput will achieve 75-85 percent of design capacity by the end of 2014. During the first quarter of 2014, the company made three shipments of copper and gold concentrate under its sales agreements and received provisional payments for two of those shipments. The timing of the gold and copper concentrate shipments and related provisional payments from Mt. Milligan are based on the structure of the company’s sales agreements.

SILVER – Dolly Varden Silver Corp. April 8 reported that through recent geoscience modeling and ongoing interpretation, the company has focused its primary advanced exploration target areas on three corridors within the Dolly Varden property. Work is now being done to prioritize the most prospective drill-ready targets within these corridors. The corridors and targets were chosen for their potential to best expand areas of known high-grade silver mineralization and to identify new Eskay-Creek style precious metals deposits. The three targeted corridors are the Torbrit-Red Point Corridor – following known silver mineralization underneath Red Point, an Eskay-Creek style target; Musketeer Corridor – which runs along the east side of the Kitsault river with numerous Ag-rich epithermal vein-type showings with strong potassic radiometric signatures; and Wolf-Surprise Corridor where an Eskay-Creek style host formation containing silver-rich VMS mineralization was identified by the company’s 2011 drill program. Through recent modeling and ongoing interpretation, the company has now moved from kilometer-scale targeting to meter-scale targeting within these defined corridors. Dolly Varden’s technical team is working to delineate specific drill ready targets within these corridors. A 40- to 50-hole (13,500-meter drill program) is being finalized, subject to financing. The combination of geophysical, and geochemical data, along with geological and structural mapping, was used to define priority target zones. Drilling will be conducted within corridors where mineralized occurrences and coincident alteration haloes point to extensive hydrothermal fluid flow. Key target areas for 2014 drilling include syngenetic VMS-style mineralization and associated feeder structures.

MANAGEMENT – BCGold Corp. April 7 reported the hiring of Paul Wojdak as the company’s vice president of exploration. Wojdak has more than 40 years of global base and precious metal exploration experience, including nearly 20 years as Northwest British Columbia Regional Geologist for the BC Ministry of Energy & Mines. In that role, he examined all significant mineral projects in Northwest B.C. and provided insight on geology, mineral deposits and exploration and mining activity to the minerals industry, government agencies and the public. Prior to joining the Mines ministry, Wojdak was an exploration geologist for Cominco Ltd. (7 years) and Westmin Resources (11 years). He worked primarily in volcanogenic and epithermal geological environments for base and precious metals in B.C. and Yukon, with some experience in the western United States, Mexico, Canadian Arctic and Africa. Wojdak graduated from McMaster University with a bachelor’s degree with honors in geology and chemistry in 1971. He was awarded a master’s degree from the University of British Columbia in 1974 for his study of the Equity Silver epithermal deposit. During his years in Smithers, Wojdak has been deeply involved with Smithers Exploration Group and Minerals North. He will continue to be based in Smithers for BCGold. “Major shareholders and the board of directors have given Wojdak the mandate to lead a deliberate prospect generator exploration business model for the company, which will leverage primarily off of his extensive northern British Columbia industry contact and mineral property knowledge base. Wojdak will utilize his expertise to network, identify, acquire, upgrade and vend new and current exploration opportunities for the company, ranging from conceptual to mid-stage properties. Wojdak also will work to establish generative exploration alliances with select mid-tier and senior exploration and mining companies, whereby acquisition and exploration costs are primarily borne by the alliance partner,” said BCGold President and CEO Brian Fowler. Wojdak replaces Darren O’Brien, who has resigned to pursue another opportunity.

MINING FEES – In response to a proposal by the Government of British Columbia to impose permit application fees on all quartz and placer mining activities, the Association for Mineral Exploration BC and its thousands of members, published a position paper recently with recommendations regarding the idea. AME BC April 2 said it believes that the proposed Mines Act permit application fees, as outlined in the February 2014 Mines Act “Permit Fees Discussion Paper,” will set a dangerous precedent and be a major disincentive to prospecting and exploring for new deposits in BC. “These proposed fees will have a long-term detrimental effect to BC’s competitiveness with other jurisdictions, regional and community economic development, job growth, and the sustainability of mining in British Columbia. These outcomes are clearly incompatible with the Government’s Families First agenda and the BC Jobs Plan,” the association wrote in a March 31 letter to Bill Bennett, BC’s Minister of Energy, Mines and Responsible for Core Review. The BC government had previously indicated the potential for “application fees for Mines Act permits” and its desire to explore “cost-recovery options” in the BC Mineral Exploration and Mining Strategy released in May 2012. AME BC’s board of directors did not endorse the strategy “primarily due to this language about cost recovery and fees,” the association said. “The proposed Mines Act permit application fees, combined with existing fees, taxes, new levies and a very difficult ongoing investment climate, will have the immediate effect in BC of: 1) reducing venture capital investment even further, 2) reducing prospecting and exploration work on the ground, and 3) decreasing the opportunity for new significant discoveries to be found in BC. Despite improvements, BC is still perceived to be a challenging jurisdiction to explore and develop mineral and coal resources, as indicated by the recent Fraser Institute’s ranking that placed BC 32nd in the world and last among all provinces in Canada in its Policy Perception Index. More work needs to be done to improve BC’s competitiveness with other jurisdictions, and introducing permit application fees will not help,” the AME BC wrote. “It is important to recognize that prospecting and exploration activities do not generate cash flow for the prospector or explorer. These activities are dependent on attracting risk capital. Without a steady and healthy influx of capital, prospecting and exploration activities are scaled back dramatically or cancelled completely. Although prospecting and exploration are vital to discovering new deposits that will generate significant revenue for government, these activities bear the highest burden of the upfront costs and risks. Contrary to the Discussion Paper, the proposed Mines Act fees do represent a substantial percentage of typical early-stage exploration expenditures, particularly for small-scale prospectors and junior exploration companies. Given a prolonged downturn in the markets, a very competitive investment climate and no certainty of actually having a permit application approved, the proposed permit fees will put an additional financial burden on many AME BC members, especially those simply struggling to survive. Permits for prospecting and exploration activities provide no tangible financial asset and should not be subject to additional fees, especially since such fees will stifle entrepreneurial activities that are critical to sustaining the annual C$8 million-C$10 billion BC mining industry. Imposing permit application fees on prospecting and exploration is equivalent to imposing a tax on research. Mine development and the economic activity it generates are not possible without prospecting and exploration work to discover new deposits that can be developed to the benefit of all British Columbians. The mines currently in production in BC, and those in the environmental assessment process, are a direct result of successful prospecting and exploration work conducted in the past, much of it decades ago. In order to develop the next generations of mines in BC, exploration must continue on an ongoing basis and at a significant level. Unfortunately, the investment climate has dramatically worsened in the past few years and raising venture capital to fund prospecting and exploration activities remains extremely challenging. ,” the association continued. Among AME BC’s recommendations: All prospecting and exploration activities be exempt from any Mines Act permit fees given that these activities produce no revenue for prospectors and explorers and are necessary to sustain the industry; the BC Government rebuild the Ministry of Energy and Mines, including re-incorporation of First Nation consultation, by allocating an additional C$10 million annually to address permitting and regulatory issues in a timely manner; and the BC government continues to undertake focused work with industry towards reducing red tape and increasing permitting efficiency.


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