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On November 29, 2010, the Company issued 31,977,899 common shares to Chesapeake Gold Corp. ("Chesapeake") in connection with the sale by Chesapeake to the Company of all of the issued and outstanding shares of Chesapeake´s indirect wholly-owned subsidiary, American Gold Capital US Inc., which holds the Talapoosa gold-silver property located in Lyon County, Nevada. The Talapoosa property is a low-sulphidation gold/silver property in the Walker Lane gold trend of western Nevada, approximately 45 kilometres east of Reno. The property consists of 509 owned BLM unpatented lode mining claims, 26 unpatented lode mining claims leased from Sierra Denali Minerals, 4 additional fee land sections leased from Sario Land and Livestock and 1 additional fee land section owned by American Gold Capital US Inc. The total land package for the property covers 12,710 acres and the land ownership consists of a contiguous package. The Company has a 100% interest in the property.
The Talapoosa Project was initially discovered in 1863 by prospectors heading east from the Comstock Lode deposit, looking for additional ore. The Property was then abandoned until 1905, when the Goldfield boom sparked exploration interest in the property. Early exploration consisted of the opening of shafts, adits and tunnels around the main resource area over Dike "Justice" Vein, the Omega Vein, and the Christensen Shaft with the most extraction of ore coming from the Glory Hole, located proximal to the Omega Vein. Minor exploration also occurred east of the main resource area around the Talapoosa Gulch area, East Hill (Equity Vein) and the President claims (Roosevelt, Washington and Lincoln Veins). There are estimated values as high as 95 oz/t gold that have been reported from boulders located on the property. The total amount of ore extracted between 1905 and 1970 has been estimated at 7500 ounces gold and 100,000 ounces silver.
Beginning in the 1970´s, exploration has been focused on building up the resource at the property. Since 1977, eight mining companies have drilled 564 drill holes for 71,000 meters along with environmental and metallurgical work. By the late 1980s, four zones of mineralization had been identified - Main Zone, Bear Creek Zone, Dyke Adit, and East Hill.
In the 1990s, metallurgical work and feasibility studies were completed, and the property was permitted for a heap-leach operation, as well as five of the operators estimating or commissioning estimates of resources and reserves at Talapoosa. All of this information has been summarized by Mine Development & Associates in a 43-101 technical report outlining a measured and indicated resource of 632,000 oz of gold at and an inferred resource of 326,000 ounces at 1.16 g/t Au equivalent.
In 2010, Gunpoint Exploration Ltd. completed a reconnaissance rock geochemical and soil orientation survey over the property. More focused rock sampling occurred in a zone known as the Appaloosa Zone consisting of several outcropping hydrothermal breccias with high-level silicification, anomalous pathfinder elements and vein fragments. The Company mapped and collected samples from the Appaloosa Zone in a south-eastwards direction to a zone historically termed the Talapoosa Gulch, with anomalous gold values (2010 results returned a high-grade sample of 2 oz/ton gold). The zone has been aptly named the Appaloosa Structure and shows similarities in mineralization and structural trend to the main Talapoosa resource area.
A ground magnetic geophysical survey was completed at the end of 2010, covering 545 km over the northeastern 2/3 of the property covering both the Talapoosa and Appaloosa structures. Subsequently approximately 8 lines covering 19 kilometres of North-South IP survey lines were completed over both structures. The geophysical results were encouraging and are being considered in locating 2011 drill targets.
In 2011, Gunpoint Exploration Ltd. will begin a 6000 metre drilling program to test IP targets peripheral to the Talapoosa structure and along the SE portion of the Appaloosa structure in early 2011. Results from the 2010 rock geochemical sampling and detailed mapping program will also be heavily considered when locating and identifying precise drill locations.
A soil grid survey is also planned over the northern part of the Appaloosa Zone. Rock samples from this zone have consisted of low gold values, with anomalous arsenic, mercury and molybdenum. The style of mineralization bears strong similarities to the enriched Talapoosa Gulch area, which is located at a lower elevation and is along the same Appaloosa structure.
