TONOGOLD and JAG Announce Amended Transaction Term Sheet and Upgrades to Stateline Project Targets

Rhea-AI Summary

Tonogold and JAG Minerals announced an amendment to their Term Sheet, extending the Exclusivity Period to July 30, 2024. They reported scintillometer readings up to 45,200 cps at the Stateline Project, with assays showing over 1% Uranium and Vanadium. Seven samples were taken from zones with visible carnotite and uraninite, providing a basis for future drilling operations. The Stateline Project, covering 2.75 square miles, includes former uranium/vanadium mines in the La Sal Creek District. Historic vanadium content averages 1.5%. Future plans include diamond drilling and gamma logging of 15-20 holes. CEO William Hunter emphasized the commitment to completing the transaction and expanding claims in Wyoming, Utah, and Colorado.

Positive

• Extension of Exclusivity Period to July 30, 2024, provides more time to finalize the transaction.
• Scintillometer readings up to 45,200 cps suggest high potential for uranium deposits.
• Assays reveal over 1% Uranium and Vanadium, indicating valuable mineral presence.
• Seven targeted samples from zones with visible carnotite and uraninite support detailed analysis for future drilling.
• Stateline Project covers 2.75 square miles in a highly prospective area with historic vanadium content averaging 1.5%.
• Future plans include detailed diamond drilling and gamma logging of 15-20 holes, indicating a structured and methodical approach to exploration.

Negative

• Extending the Exclusivity Period may indicate delays in finalizing the transaction.
• The presence of historic mines, which were abandoned due to market collapse in 1979, suggests potential market volatility risks.
• Only seven samples taken, which might not be representative of the entire area, could lead to overestimating resource potential.
• The need for extensive future drilling and analysis suggests high upfront costs and potential financial risk.

Highlights

• TONOGOLD advises the Term Sheet entered into with JAG Minerals Pty Ltd ("JAG") on March 25, 2024, has been amended, extending the Exclusivity Period to July 30, 2024.
• Scintillometer readings up to 45,200cps, with assays revealing >1% Uranium and >1% Vanadium.
• Seven targeted samples taken from zones with visible carnotite and uraninite, primarily from in-situ sources, will provide a crucial basis for detailed analysis and aid in planning drilling operations.

WOODLAND HILLS, CA / ACCESSWIRE / May 30, 2024 / TONOGOLD Resources Inc. (OTC PINK:TNGL) ("TONOGOLD" or the "Company") advises that it and its merger partner, JAG Minerals USA, Inc., have amended the Term Sheet dated March 25, 2024, to extend the Exclusivity Period by 35 days to July 30, 2024. This Extension will give the parties the ability to consummate the transaction as previously announced.

In addition, TONOGOLD and JAG have also released recent assay results from a sampling program at the Stateline Project. The project covers 2.75 mi² (7.2 km²) across seven strategic areas in the highly prospective La Sal Creek District, approximately 19 km from the La Sal Complex operated by Energy Fuels Inc.

Figure 1: Project and Process Mill locations.

Project Background

The Stateline claims were staked over several former uranium/vanadium mines in the La Sal Creek District, which were actively mined from 1947 to 1979. The Three Mile Island incident in March 1979 devastated the uranium ore market, leading to the abandonment of these mines. Historically, Vanadium (V2O5) was produced as a byproduct of uranium (U3O8) ores, with high vanadium content ranging from 1% to 3%, averaging around 1.5%, significantly higher than most North American V2O5mining plays.

Figure 2: Stateline Project over USGS Uranium-Vanadium depositsof the La Sal Quadrangle, pp508. ¹

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^{1 Geology and uranium-vanadium deposits of the La Sal quadrangle, San Juan County, Utah, and Montrose County, Colorado, Carter, W.D., and Gualtieri, J.L. USGS, PP 508, 1965}

Mapping Methodology

The mapping strategy at Stateline involves targeting areas with visible carnotite mineralization where scintillometer readings surpass 3000 cps, optimizing the search for high-potential uranium deposits. Scintillometer checks are routinely performed at 0.1-mile intervals, or more frequently in notable areas, focusing on geological units and historical mining structures like sealed adits, which are marked with brass caps for reference. Sampling primarily target areas with evident carnotite or uraninite in bedrock, avoiding less reliable float or tailings unless necessary. Most samples, numbering seven in total, were collected in-situ.Additionally, strike and dip measurements are taken at sites with clear bedding or jointing, aiding in understanding the host rock's structure to predict potential subsurface uranium sites for future drilling.

Mapping Assessment and Observations

Mapping results indicate two ore zones; the lower zone exhibits higher scintillometer readings, with values up to 45,200 cps, compared to 35,000 cps in the upper zone. Seven samples, labeled SL1-SL7 (see Figure 3) were taken across these zones, revealing multiple high-value locations within a 400-foot area.

Figure 3: Stateline Rock Chip Sample Locations.

The presence of carnotite near the Uranium Girl Mine and unexplored western claim areas suggests potential for extended ore zones. Additionally, anomalous readings up to 900 cps were detected in pinyon pines near exposed mineralization, pointing to a unique, yet unconfirmed, geological interaction that requires further study.

Sample Results

The recent sample analysis from our uranium exploration project highlights significant findings and key geological characteristics across several test sites, as detailed in Table 1.

Table 1: Sample Assay Results.

Comments for these samples are below:

SL1: High-grade, bright yellow carnotite interlayered with fine-grained, black rock at outcrop base.

SL2: Carnotite impregnated in silty sandstone, showing oxidized sediments and exposed bedding, near old workings.

SL3: Visible carnotite in an 18-inch zone of fine-grained sandstone interbedded with green mudstone; extensive area, suggesting potential below-surface extension.

SL4: Carnotite in fine-grained sandstone with thin beds, located in adit waste pile; notable for finding a significant bone piece.

SL6: High-grade, visible carnotite in fine-grained, reddish-brown sandstone near an old adit; extensive and highly radioactive area.

SL7: Composite sample from Uranium Girl Mine tailings, selected for higher grade material despite being less visually appealing.

These highlights demonstrate the promising nature of the uranium deposits in the area, with significant implications for further exploration and potential mining activities.

Figure 4 (left): Outcrop sample SL06 field photo (RS-125 unit returned 45,200 cps).
Figure 5 (right): Using the RS-125 to get elevated cps values on the tree for comparison against the surrounding counts

Future Plan

The Company is currently planning to complete diamond drilling and gamma logging of 15-20 holes, with accompanying geochemical analysis to adequately define disequilibrium across the deposit and test extensions. This will enable an updated NI43-101Technical Report.

TONOGOLD CEO William Hunter stated: "Both the Company and JAG are committed to completing the previously announced transaction and are working through the business and due diligence processes. JAG Minerals USA, Inc. has been active in expanding its Uranium and Vanadium claims in Wyoming, Utah and Colorado. Specifically focused on claims that have detailed historic Uranium data and / or published resources open for potential expansion. This development is very positive to the combined Company and the proposed Transaction between Tonogold and JAG Minerals as announced on April 11, 2024, remains unchanged."

Qualified persons

Mr Andrew Hawker,BSc. Geol, MAIG, is a member of the Australasian Institute Geoscientists, is a consultant to JAG Minerals USA, Inc. and is a Qualified Personas defined in National Instrument 43-101. Mr. Hawker is in charge of exploration programs and has reviewed and approved the technical information contained in this news release.

Enquiries

For further information, please contact:
William Hunter
Interim CEO Tonogold Resources Inc
M: +1 203 856 7285
E: bhunter@tonogold.com

SOURCE: Tonogold Resources, Inc.

View the original press release on accesswire.com

FAQ

What is the new Exclusivity Period for the Tonogold and JAG Minerals transaction?

The Exclusivity Period for the Tonogold and JAG Minerals transaction has been extended to July 30, 2024.

What scintillometer readings were reported at the Stateline Project?

Scintillometer readings up to 45,200 cps were reported at the Stateline Project.

What were the assay results from the Stateline Project samples?

Assays revealed over 1% Uranium and over 1% Vanadium in the samples from the Stateline Project.

How many samples were taken from the Stateline Project and what did they reveal?

Seven samples were taken, revealing high-value zones with visible carnotite and uraninite.

What is the historical vanadium content in the La Sal Creek District?

The historical vanadium content in the La Sal Creek District averages around 1.5%.

What are Tonogold's future plans for the Stateline Project?

Tonogold plans to complete diamond drilling and gamma logging of 15-20 holes to define the deposit and test extensions.

What implications does the presence of historic mines in the Stateline Project area have?

The presence of historic mines suggests potential for high mineral content but also market volatility risks.