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Otis Gold poised to ramp up exploration at flagship Kilgore project

The firm has now submitted a "plan of operation" to the US forest service for Kilgore
Otis Gold poised to ramp up exploration at flagship Kilgore project
Otis has been getting some strong drill results from Kilgore

Otis Gold Corp (CVE:OOO, OTC:OGLDF) is at a key point in its evolution as it looks to a busy 2018 and a ramp-up of exploration at its exciting  flagship Kilgore project in Idaho.

The firm has now submitted a "plan of operation" to the US forest service, which sets up  a program of drilling of up to 140 new sites and 400 holes.

Kilgore is open for extension to the northwest, southeast and at depth and the firm's focus has been exploring the geology, which is underneath the existing deposit.

Recent results from the  first three holes aimed at following up on this prospective Aspen formation included 129.4 metres (m) at a grade of 1.66 grams per tonne (g/t) gold, which included 24.4 m at 3.45 g/t in one hole.

Significantly, the deposit already identified  already hosts a resource estimate of  820,000 ounces of the yellow metal, and the plans is to produce an updated resource.

In a recent interview with Proactive, Craig Lindsay, the group's founder and chief executive, told Proactive: "It's really turning into one of the most exciting gold exploration stories in the western US."

So what is the deposit?

Kilgore spans over 5,130 acres and is targeting an epithermal type deposit. It has a  current NI 43-101 resource of 520,000 ounces of indicated gold from 27.3 million tons at 0.59 grams per ton (gpt) gold, and 300,000 ounces of inferred golf from 20.2 million tons at 0.46 gpt gold.

In the frame before...

Kilgore has been in the frame before. In the 1980s and 1990s a number of gold companies saw its huge potential.

One in particular, Echo Bay Mines, was ready to press the trigger on a 45-50,000-ounce operation in the late 1990s that would have survived at US$350 gold.

But the development was shuttered when the price of the yellow metal tanked.

The former owner suspected it had uncovered not one deposit, but a number of gold, ‘volcanic-hosted’ targets potentially containing 2-3mln ounces of gold.

“Geologists will tell you epithermal systems are like grapes: they come in bunches and you never find just one grape on the bunch,”  Lindsay said in 2016.

"When someone asks what I can see, I am comfortable talking about the potential for a 2-3mln ounces assuming one or two of the additional targets achieves the size of the existing target. Talking about anything bigger at this stage is difficult."

Other irons in fire

The group also has the Oakley Gold Project comprising 1,360 acres, also in Idaho, which is 15 miles south of the town of Oakley and just north of the Utah/Nevada border.  It has two primary targets - Blue Hill Creek and Cold Creek. It also hosts the Matrix Creek property.

Oakley has an NI 43-101 inferred resource of 163,000 ounces of gold at a grade of 0.51 g/t.

In June, it told investors it has kicked off fieldwork at the site.

In February, 2017 Otis announced that Agnico-Eagle Mines Ltd (NYSE:AEM) had taken a strategic investment in the firm via a placing, to the tune of over $5mln.

Agnico, a key investor,  now has around 9.95% of the shares and has the right to participate in certain equity financings by Otis in order to maintain that stake.

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