Battle Mountain Gold Inc.

Lewis Gold Property, Nevada

LOCATION: Approximately 2,225 hectares (5,500 acres) in Lander County, Nevada, within the Battle Mountain Trend, which hosts a series of gold mines (Marigold, Lone Tree, Fortitude, Phoenix, Twin Creeks, Midas, Trenton Canyon) with resources or past production collectively totaling more than 25 million ounces of gold.

OPPORTUNITY: Precious Metals. The main exploration targets are high-grade structurally controlled veins/faults and lower grade disseminated skarns and replacements associated with north-trending structures and Tertiary intrusives.


Nevada is the world's third largest gold-producing region after South Africa and Australia, accounting for 85% of US production. Most of the state's gold and silver comes from the prolific Carlin Trend and the parallel Battle Mountain Cortez-Eureka Trends. The Lewis Property is strategically located within the Battle Mountain Trend, which hosts a range of mineral deposit types including high-grade vein-hosted gold deposits, large gold-copper porphyry systems with associated peripheral gold-silver skarns, and sedimentary-rock-hosted disseminated gold deposits.

The Lewis Property is directly contiguous with the Phoenix Mine placed into production by owner Newmont Mining in late 2006. This open-pit mine lies outside of the Lewis property. The Phoenix Mine produced 211,000 ounces of gold and 46 million pounds of copper in 2014 (Newmont 2014 Annual Report and Form 10-K). Previous operators at Lewis focused their exploration efforts on the Virgin Zone, a major structural-stratigraphic corridor which hosts the mineralization at Newmont's adjacent Phoenix Mine. Their programs confirmed that the Virgin Zone extends onto the Lewis Property within a similar geological environment, for up to 4.5 km of potential strike length, of which only a small portion has been drill-tested to date. Madison has also drill-tested the adjacent sub-parallel Copper Canyon-Buena Vista Structural Zone and a series of structural splays associated with the Virgin Zone.

After securing an option to earn 60% of the Lewis Property in 2002 (since earned), Madison Minerals traced the extension of the Virgin Zone north from the Newmont boundary onto the Lewis Property for at least 4.5 kilometers, of which only a small portion has been drill-tested to date. Madison's drilling has also tested a series of associated structural splays, one of which returned bonanza grades of 17.5 g/t gold and 48.1 g/t silver over 32 meters at its intersection with the Virgin Zone.

In addition to testing the extension of the Virgin Zone and its associated structural splays, Madison has drill-tested the adjacent sub-parallel Copper Canyon-Buena Vista Zone, located 500 meters west and south of the Virgin Zone. Other areas of interest include two locally mineralized zones with evidence of small-scale historic production.

From 2002 to 2008, Madison has drilled 145 reverse circulation (RC) and 29 core holes totaling 36,100 meters (118,100 feet) at the Lewis Property, 160 of which tested the Virgin Zone. All but 15 of these 174 holes interested mineralization.

The results of previous, recent and ongoing exploration programs will be used to generate an initial NI 43-101 compliant resource estimate for the Lewis Property.

Historic Exploration

The Lewis Property was historically mined for high-grade silver, gold and base metals and was first drilled in modern times by Hart River Mines (1980-1985). The discovery and development of a series of world-class gold deposits in the Carlin and Battle Mountain-Eureka Trends during the 1980s attracted several senior companies to intermittently explore the Lewis Property, notably Homestake Mining and the predecessor company of Barrick Gold. A subsequent round of exploration took place from 1996 to 1997, when United Tex-Sol Mines Inc. drilled holes UTX 1-16 at Lewis.

The Fortitude Mine adjacent to the Lewis Property was the most significant gold producer in the Battle Mountain Trend during the 1980s and became the flagship operation of Battle Mountain Gold Company after it was spun off from Pennzoil Company in 1985. As Fortitude's high-grade reserves declined in the early 1990s, Battle Mountain Gold diversified from its namesake district to pursue projects worldwide. From 1984 to closure in early 1993, the Fortitude skarn deposit produced 2.8 million ounces of gold and 10.8 million ounces of silver from 11 million tons of ore, with heap-leaching of lower grade disseminated ores continuing until 2006.

Newmont Mining acquired Battle Mountain through a merger process completed in early 2001, and soon after reactivated exploration of the Phoenix deposit, the lower grade outer shell of the past-producing Fortitude Mine. The newly constructed Phoenix Mine began operations in late 2006 in time to benefit from rising gold prices.

The intermittent exploration efforts of previous operators at the Lewis Property during the 1980s and 1990s focused on the strike extension of the Virgin Zone, the favorable structural-stratigraphic corridor hosting most of the known mineralization at Newmont's adjacent property. Their programs partially traced the Virgin Zone for a minimum 1,000 feet onto the Lewis Property and also outlined a virtually identical geological environment to that underlying Newmont's adjacent property.

Exploration Programs 2008 and 2009

The 2008 drill program – 17 core holes totaling 3,855 meters and 33 RC holes totaling 5,567 meters – targeted the central portion of the Virgin Zone and consisted of in-fill and step-out holes using 30-meter drill spacings. The core drilling confirmed the previous RC results as well as the geological and structural models, while the overall drilling program expanded the Virgin Zone by 100 meters down-dip over a 300-meter strike length. At year-end 2008, the Virgin Zone was defined over a minimum 750-meter strike length and 350 meters east-west. The zone remains open for expansion along strike to the north and south and down-dip to the west.

The 2008 drilling program also encountered significantly higher silver values. As an example, Hole MAD-145 intersected 1.21 g/t gold and 458 g/t silver over 6 meters, for a calculated equivalent of 7.17 g/t gold (at US$9 per ounce silver and US$900 per ounce gold) over the interval. These results suggest an apparent mineral zonation on the property, with silver values increasing to the north and west.

Results from the 2008 drilling program compare favorably with previously reported styles and grades of mineralization, including high-grade mineralized structural intersections, steeply oriented structural mineralization and sub-horizontal lower grade mineralization hosted by favorable Antler stratigraphy. Most of the 2008 drill-holes intersected the most common type, sub-horizontal lower-grade mineralization.

Madison's exploration programs to date have further confirmed that the Lewis Property shares a virtually identical geological environment to that underlying the Phoenix-Fortitude area, including a direct on-strike extension to the hosting Antler Sequence stratigraphy, controlling structures (Virgin and Copper Canyon – Buena Vista Structural Zones) and mineralizing styles: a sub-vertical structurally controlled type and a sub-horizontal, stratigraphically controlled type.

The southern boundary of the Lewis Property lies just 250 meters north and 100 west of Newmont's present open pit, which means any new or proposed northerly or westerly expansion of this pit would require a pushback onto the Lewis Property.

The exploration program for 2009 was planned to test the extension of the Virgin Zone, the most advanced exploration target at the Lewis Property, as drilling to date has only tested a small portion of its potential 4.5-km-long extent. Other areas of exploration interest include the adjacent sub-parallel Copper Canyon-Buena Vista Zone, located 500 meters west and south of the Virgin Zone and the 2-km-long, Central Virgin-Hider-White-Shiloh Zone and the easterly sub-parallel Trinity Zone. Both are known to host significant gold and silver mineralization locally, including small historic production.

2014 – 2015 Exploration Programs

The Company commenced exploration of the Lewis property in late June, 2014. The field-work completed to date consists of detailed geological surface mapping (1:2,000-scale), geochemical rock- and soil-sampling, and re-logging of diamond-core and RC-chips from drill-holes completed by Madison Minerals Inc. from 2003 to 2008. The emphasis during this work has been on the geometric controls to gold-silver-and base metal-bearing fault and fracture systems. These target structures cut across several rock formations that have properties conducive to metals deposition, including the same formations that host ore in the Fortitude mine of Newmont, located directly to the south.

At least eight mineralized zones were previously recognized in the Lewis property (refer to slides in the corporate presentation included in the Investor Info – Presentations section of the web-site and corporate press-releases from June, 2014 to recent). The best understood gold-silver systems to date include the Virgin, Buena Vista, Meagher-Silver, White-Shiloh and Trinity structural zones, which are open along strike and at depth. Gold- and silver-bearing portions of these zones exceed 1,200 m for the Virgin; 1,300 m for Buena Vista; 650 m for Meagher-Silver; 900 m for White-Shiloh; and 1,700 m for Trinity. Recent geochemical sampling of these zones and news areas of mineralization indicate rock results of up to 99.9 g/t Au, 5600 g/t Ag, 11.8% Pb and 6.2% Zn. Individual sample assay results are described in the rock-chip database included in the Investor Info – Presentations section of the web-site. The samples were collected from steeply dipping, northerly- and northwesterly-striking fault and fracture zones that are typically illitic clay-altered and characterized by iron-oxides that have formed from the weathering of pyrite, galena, sphalerite and locally arsenopyrite. The outcrop samples are from zones 1 to 5 m wide that lie within broader belts of structure / hydrothermal alteration up to 75 m wide.

The results of 201 rock samples collected over the property as of June, 2015 are summarized as follows: Gold – 89 samples (44 % of all samples) contain > 1 g/t; 26 yield > 5 g/t; 11 contain > 10 g/t with maxima of 99.9, 53.4, 36.8 and 24.7 g/t Au. Silver – 90 samples (45 %) contain > 50 g/t; 43 yield > 200 g/t; 17 contain > 500 g/t with maxima of 5600, 3620, 1810 and 1695 g/t Ag. Lead and Zinc – 73 samples contain > 1 % Pb with a maximum of 11.8 %; 16 samples return > 1 % Zn with a maximum of 6.2 % Zn.

Silver values in rock up to 5600 g/t Ag and gold results up to 13.2 g/t Au characterize the Meagher-Silver zone in the western part of the property. This zone consists of two north-trending and west-dipping faults, each more than 650 m long. These mineralized structures and those of the Buena Vista system, with surface values of up to 24.7 g/t Au and 359 g/t Ag, extend to the south into the Fortitude copper-gold-silver mine. The intersection of these mineralized structures with the reactive rocks that host ore in the Fortitude deposit represents an attractive drill target that lies from 100 to > 300 m beneath surface in the Lewis property.

In late-2014, a total of 466 soil samples were collected along traverses oriented across the northerly-trend of the Trinity system in the southeastern part of the claim area. The samples are spaced every 8 m (25 ft) with every two samples composited to form 233 assay samples for a nominal spacing of 16 m (50 ft). The assay results indicate high values for gold, silver lead and zinc. The combined gold (Au > 100 ppb) and silver (Ag > 5 ppm) soil anomaly is localized along a north-northeasterly trending portion of Trinity fault zone and exceeds 1,700 m in strike-length with widths of up to 200 m. This anomalous gold-silver zone is supported by a coherent lead and zinc anomaly, using thresholds of 300 ppm Pb and 300 ppm Zn. Rock chip samples from the Trinity return up to 14.1 g/t Au, 1490 g/t Ag, 5.4 % Pb and 1.6 % Zn (see rock-chip sample database for individual sample assay results). Future work in this area will focus on follow-up surface mapping and drill target delineation.

Hyperspectral imagery (HSI) was acquired over the Lewis property and portions of the adjacent Newmont mine operations on July 13th, 2014 by SpecTIR LLC using an AISA Eagle/Hawk Dual (Dual) hyperspectral camera system carried by a light aircraft. Approximately 65 Km2 of data were acquired with a nominal ground resolution of 2 m. The Dual system acquired 360 spectral bands between 400 and 2,450 nanometers with spectral resolutions ranging from the visible to shortwave infrared. Similar types of hyperspectral analysis have delineated mineral zoning and directions to ore-bearing structures in gold- and silver-bearing deposits elsewhere in Nevada (e.g., Goldfield), Utah (e.g., Tintic District) and Mexico (e.g., Fresnillo region). A ground-based spectroscopy survey was completed in support of the airborne survey, during August, 2014. A total of 272 surface samples and 81 drill-core samples were analyzed using a TerraSpec Pro spectrometer.

The results of the airborne- and ground-surveys have been integrated with local geology to produce a coherent interpretation over the project area. In gold- and silver-bearing structural zones, HSI illite commonly occurs with HSI hematite and jarosite, which are iron-oxide minerals that developed from the weathering of sulfide minerals. There is a close spatial coincidence of HSI hematite and jarosite to known prospects and structures. The combined spectral surveys identified new zones of exploration interest, some of which are characterized by ammonium-illite. Ammonium-illite has the potential to delineate structures that tap gold-rich zones at depth, as indicated for Carlin-type gold deposits in Nevada (e.g., Goldstrike and Jerritt Canyon) and epithermal gold deposits in Argentina (e.g., Esquel). Hematite typically occurs within zones of ammonium-illite hosted in the Nevada Carlin-type deposits. Follow-up sampling of these ammonium-illite anomalies have produced targets at Galena and the Apex antimony mine, which are characterized by surface rock-chip results of up to 3.1 g/t Au, 353 g/t Ag, 1% As and > 1 % Sb (see rock-chip sample database for individual sample assay results).

During late-2014, the Company completed the digitizing of down-hole geology logs and multi-element assays for about 280 drill-holes completed by Hart River, Barrick and Sante Fe during the 1980s and 1990s. Most of the added holes are less than 150 m deep and collared in the Trinity, White-Shiloh, Hider and Circle Peak areas. The current digital drill-hole database, which includes 224 drill-holes in the Virgin-Buena Vista area, now totals approximately 500 drill-holes. The incorporation of this historic data into the Lewis property digital database has assisted in the creation of 3D geological models for mineralized structures and favorable rock units in the southern part of the claim area.

Also during late-2014, a total of 14 diamond drill-holes were re-logged from the Virgin area for a total of 3,200 m or 50 % of the drill-core collected by Madison Minerals Inc. during 2003 to 2008. In mid-2015, RC-chips from about 50 holes were re-logged for 10,800 m or 38% of the RC-chips available. The focus of the re-logging campaign was to better define lithology, hydrothermal alteration, sulfide mineralization and structure in drill-hole and to ensure consistency with the surface mapping recently completed by the Company. The integration of the results of the re-logging program with the district-wide drill database has enabled the construction of about 48 west-east oriented geological cross-sections.

Three-dimensional imaging of geophysical results from a Quantec TITAN - IP survey from 2003 and a Zonge IP survey from 2007 completed over the Virgin and Buena Vista areas was undertaken in late-2014. The magneto-tellurics (MT) data from the Quantec survey was re-processed by SourceOne Geophysical using modern algorithms in the 3rd Quarter of 2015. This reprocessing has improved the resolution of the results and sharpened resistivity boundaries, which has assisted in the understanding of the 3D geological models and drill-target delineation.

The integration of the updated and revised digital drill database and re-processed geophysical data with the results of surface mapping and geochemical sampling has served as the basis for the creation of comprehensive 3D models for the southern portion of the Lewis property. The geological portions of the models were created through collaboration with SRK Consulting (Reno) using LeapFrog software in the 3rd Quarter of 2015. The understanding gained through the creation of these models has assisted the Company in the generation of several high-grade gold-silver targets. The most compelling of these targets lie in the Virgin, Buena Vista and Meagher-Silver areas in the southern part of the Lewis property. It is planned to test these targets by a 4100 m diamond drill-program, scheduled to start in the latter part of 2015. Attractive targets also exist in the Galena, White-Shiloh and Trinity systems, which are intended for drill-testing in 2016.

The technical information in this website about activities on the Lewis Project from June 1, 2014 onwards has been prepared by the Company’s Qualified Person, Steven Garwin, Ph.D., a director of the Company, a Fellow of the Australian Institute of Geoscientists and a Fellow of the Australasian Institute of Mining and Metallurgy. The technical information in this website on activities on the Lewis Project prior to June 2014 is based upon a report under National Instrument 43-101filed on SEDAR March 31, 2014 and titled AMENDED AND RESTATED SUMMARY REPORT 2007-2008 CORE AND REVERSE CIRCULATION DRILLING PROGRAM, F.W. LEWIS PROPERTY, BATTLE MOUNTAIN MINING DISTRICT, LANDER COUNTY, NEVADA, USA (the “2014 43-101 Report”). Dr. Garwin has reviewed the 2014 43-101 Report and has approved the written disclosure drawn therefrom set out in this website.