Kilgore Ground Mag And Soil Surveys Identifies New Exploration Targets

VANCOUVER - Otis Gold Corp. reported an update and interpretation of extensive exploration activities conducted on the Kilgore Deposit and the emerging "Gold Ridge" exploration target at the Kilgore Gold Project, Clark County, Idaho. Specifically, a 34-line-kilometer ground magnetometer survey was completed along with a program consisting of 213 surface and subsurface soil samples. The Company's ground magnetometer survey delineated many previously mapped faults in addition to numerous newly-identified structural features. The accompanying soil geochemistry displayed corresponding anomal ies along defined structures and structural intersections demonstrating that mineralizing hydrothermal fluids traveled upward along these zones of structural weakness similar to what controls gold mineralization at the Kilgore Deposit, located approximately 1.0 km to the southeast of Gold Ridge. During the Fall of 2016, the Company completed a 34-line-km ground-based geophysical magnetometer survey in and around the Kilgore Deposit and extending over 1.0 km to the northwest to an area known as Gold Ridge. Line spacing for this study was at 100 meter spacing along lines with a 50 degrees and 230 degrees azimuth. The goal of this survey was to supplement the historic helicopter magnetometer survey completed in the mid-1990s, by providing a greater resolution of the magnetic signatures of the local geology surrounding the Kilgore deposit.

An advanced Euler 3D deconvolution reduction was performed on the data to help delineate geologic structures. The ground magnetic survey revealed that the Kilgore Deposit and region was preferentially structurally prepared prior to the magmatic epithermal gold mineralizing event. The hydrothermal fluids and other intrusions utilized zones of weakness and dilation due to the pre-existing conjugate fault system (azimuth 300 degrees and 10 degrees ) and extensional and relaxation faulting (azimuth 335 degrees and 60 degrees ). These structural features are interpreted in the magnetic data and include the right-lateral and dip-slip Northwest 300 degrees fault, and several new subordinate 300 degrees faults like the Snotel, Vortex, and Sage. The magnetic data also delineate the known left-lateral (10 degrees -60 degrees ) Bear Cat, Cabin, and Mine Ridge faults and identified several new subordinate (10 degrees -60 degrees ) faults like the Antler and Dog Bone faults. Also, revealed by the magnetic data are mafic dike swarms following multiple 300 degrees -striking structures, a rhyolite flow-dome, and the Tertiary mafic sill (covering an area approximately 1km x 1km).

The structural features and boundaries create a network of structural compartments, some of which could be favorable hosts for hydrothermal gold mineralization, similar to the newly discovered Aspen Corridor. The existing Kilgore Deposit is interpreted to be located in and around one such mineralized compartment, roughly bound by the Northwest fault and the intersections of the Mine Ridge and Cabin Faults.

During the 2016 field season, 213 soil samples were collected and added to the historical database that now totals a master dataset of 3,517 samples. These data show anomalous soil geochemistry along defined structures and demonstrate that they were conduits for mineralizing fluid flow. The gold (Au) in soil map illustrates a sizeable anomaly that encompasses the current Kilgore Deposit and extends to the northeast where it is still open along the Cabin and Mine Ridge fault extension areas. The soil anomaly appears to increase in intensity as it approaches the Snotel 300 degrees fault. The Snotel fault also has anomalous gold in soils where it intersects the Bear Cat fault structure. Another new soil anomaly is located at the intersection of the Vortex and Antler faults, both of which have limited soil geochemistry coverage.

The geochemical soil data have also revealed several pathfinder element anomalies. Selenium (Se), arsenic (As), and antimony (Sb) anomalies are also located along the defined structures and are more prominent to the northwest, indicating that area is higher up in the epithermal mineralizing system. Where trace elements occur at structural intersections, the juxtaposition denotes a target for future exploration drilling.

Otis is currently permitting 27 drill stations at the Kilgore Deposit and 7 drill stations at Gold Ridge. Otis is working with the U.S. Forest Service to obtain approval for these sites to coincide with the planned commencement of drilling at Kilgore in late July. Approximately 8,000 meters of drilling is currently envisioned, which will be focused on expansion of the Kilgore Deposit in the emerging Aspen Corridor target. The program will also include two metallurgic test holes to enable metallurgical studies on the Aspen Corridor host rock. Additionally, based on the success of the ground magnetometer survey discussed herein, an important element of 2017 field operations will be a robust geophysics survey over the remainder of the Kilgore Gold Project, including Prospect Ridge and Dog Bone Ridge, and a comprehensive soil survey over all targets to assist with drill planning and targeting.