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Home > News > News Release

News Release

Paramount Gold's Sleeper Project In Nevada Continues To Grow


Winnemucca, Nevada –September 19, 2011 -Paramount Gold and Silver Corp. (NYSE /TSX: PZG) (Frankfurt: WKN: A0HGKQ) ("Paramount") announced today new core drill results from its 100% owned Sleeper Gold Project in Nevada that (1) have likely increased the grade of the Facilities Zone resource and (2) confirmed the presence of gold mineralization in a new area, the Sleeper South Extension Zone located south of the historical pit and under the south waste dump, which is expected to add to resources. These results (reported below) were not included in the NI 43-101 resource estimate prepared by SRK Consulting (www.srk.com) and released last week but they will be incorporated into a re-estimation of the Sleeper resource expected later this year.

Drill holes in the Facilities Zone were designed to better define higher grade zones and establish their continuity.  Samples from these holes will also be used for metallurgical testing as part of the process of preparing a Preliminary Economic Assessment (PEA). Drill hole intercepts in the Facilities oxide zone returned excellent results with long intercepts of better-than-average gold grades; hole DDH-11-010, drilled in the northwest part of the Facilities Zone, intercepted 64 meters grading 1.1 g/T of gold and 2.9 Ag g/T of silver including 14 meters grading 2.8 g/T of gold.

In addition, reverse circulation (RC) drilling on two new exploration targets (the South and Southwest zones) successfully intersected promising alteration indicative of mineralized structures.  These untested structural zones had been inferred from the Project data base but no significant grades were encountered. Additional holes along the strike of these targets are planned to look for expected areas of enriched mineralization since similar structures are known to control and concentrate gold mineralization at Sleeper. A third exploration target, named Northwest, was not intersected as RC drilling failed to penetrate through alluvial gravel. Overall, four of nine RC holes failed to reach target depth due to difficulties drilling through surface alluvial materials. Different equipment options are being evaluated to improve productivity when the program resumes, recognizing that a number of highly prospective untested targets at Sleeper lie beneath gravel cover.  

Christopher Crupi, Paramount`s CEO commented, that “we believe these new results should increase project size and grade as well as confidence in our resource model as we move into the final stages of our PEA. We are planning a further 15,000 meters of drilling over the next several months. Some of this work will complete the upgrading of resources for the PEA but the main focus will be on a series of exciting new exploration targets.”

Assay results are as follow:

Hole Number Zone/Target From (m) To (m) Interval (m) g/T Au g/T Ag
PGC-11-007 0.00 10.70 10.70 0.336 5.8
16.80 25.90 9.10 0.359 7.7
Facilities 39.60 80.80 41.20 1.068 1.6
including 42.70 65.50 22.80 1.562 1.8
86.80 88.40 1.60 0.310 0.3
PGC-11-008 Sleeper South Extension 72.00 82.00 10.00 0.541 0.5
86.00 106.00 20.00 0.557 4.0
112.00 118.00 6.00 0.242 0.3
122.00 124.00 2.00 1.185 0.6
159.70 174.00 14.30 0.654 0.7
186.00 192.00 6.00 0.249 0.3
PGC-11-009 21.00 51.00 30.00 0.805 1.8
Facilities 61.00 77.00 16.00 0.737 0.8
83.00 85.00 2.00 0.414 2.8
PGC-11-010 11.58 14.00 2.42 0.379 0.8
36.00 100.00 64.00 1.098 2.9
Facilities including 40.00 54.00 14.00 2.782 1.8
127.30 128.00 0.70 0.521 6.6
136.00 140.00 4.00 0.287 3.0
PGR-11-013 South no significant intervals
PGR-11-014 South no significant intervals
PGR-11-015 Southwest no significant intervals
PGR-11-016 Southwest no significant intervals
PGR-11-017 Southwest abandoned at 177 m in alluvial gravel
PGR-11-018 Southwest abandoned at 146 m in alluvial gravel
PGR-11-019 Sleeper South Extension 6.10 7.62 1.52 0.807 3.4
24.38 27.43 3.05 0.507 1.5
184.40 187.45 3.05 0.387 2.3
210.31 217.93 7.62 0.299 4.8
PGR-11-020 Northwest abandoned at 107 m in alluvial gravel
PGR-11-021 Northwest abandoned at 274 m in alluvial gravel

The orientation of these drill holes was designed to intercept the structural features at right angles so as to provide a close approximation to true width and it is believed that they represent the true width of the mineralized zone as a whole. However, at Facilities zones, mineralized structures and veining are striking and dipping in several orientations and these intersections may be at less than optimum angles.

The Sleeper Gold Project is located off a main highway about 25 miles from the town of Winnemucca, Nevada.   Acquired by Paramount in 2010, the 45 square mile project area includes the original Sleeper high-grade open pit mine operated by Amax Gold from 1986 to 1996 as well as newly purchased claims stretching south down trend to Newmont`s Sandman project.

The current work program at Sleeper is consistent with Paramount's strategy of expanding and upgrading known, large-scale precious metal occurrences in established mining camps, defining their economic potential and then partnering them with nearby producers.  As a former high-grade gold producer, Sleeper is ideally located near established, low cost production in Nevada, where the infrastructure already exists for early, cost-effective exploitation. Tetra Tech (www.TetraTech.com), a leading international mining consulting firm, has been engaged to prepare an NI 43-101 compliant PEA of the Sleeper gold project for completion in early 2012.

Sleeper is emerging as one of Nevada’s largest new undeveloped gold resources, containing an in situ measured and indicated resource of 2.6 million ounces of gold and 25.3 million ounces of silver and an additional inferred resource of 1.1 million ounces of gold and 8.2 million ounces of silver (see table below and Paramount news release of September 13, 2011).

Sleeper Resource Table

Material Cut-off Au g/t INFERRED
Tonnes Au g/T Ag g/T Au Oz Ag Oz
Oxide 0.20 31,960,502 0.39 4.23 397,669 4,346,620
Sulfide 0.25 91,074,631 0.54 5.06 1,569,495 14,816,501
Total 123,035,133 0.50 4.84 1,967,164 19,163,121
Material Cut-off Au g/t INFERRED
Tonnes Au g/T Ag g/T Au Oz Ag Oz
Oxide 0.20 10,829,438 0.33 4.12 114,203 1,434,501
Sulfide 0.25 38,898,882 0.44 3.79 544,032 4,739,953
Total 49,728,320 0.41 3.86 658,235 6,174,454
Material Cut-off Au g/t INFERRED
Tonnes Au g/T Ag g/T Au Oz Ag Oz
Oxide 0.20 42,789,940 0.37 4.20 511,872 5,781,121
Sulfide 0.25 129,973,513 0.51 4.68 2,113,527 19,556,454
Total 172,763,453 0.47 4.56 2,625,399 25,337,575
Material Cut-off Au g/t INFERRED
Tonnes Au g/T Ag g/T Au Oz Ag Oz
Alluvial 0.20 151,675 2.03 - 9,890 -
Oxide 0.20 13,191,635 0.32 3.42 136,145 1,450,516
Sulfide 0.25 68,410,857 0.44 3.07 974,376 6,752,446
Total 81,754,167 0.43 3.12 1,120,410 8,202,962

Exploration activities at Sleeper are being conducted by Paramount Gold under the supervision of Glen van Treek, Exploration Vice President of the Company and Bill Threlkeld, a Qualified Person as defined by National Instrument 43-101, who have both reviewed and approved this press release. An ongoing quality control/quality assurance protocol is being employed during the program including blank, duplicate and reference standards in every batch of assays.  Samples are being assayed at ALS Chemex, Reno, Nevada and multi-element analyses are being conducted in Vancouver, Canada. External check samples are also being conducted at the Inspectorate Lab in Reno.

Cautionary Note to U.S. Investors Concerning Estimates of Indicated and Inferred Resources
This news release uses the terms "measured and indicated resources" and "inferred resources". We advise U.S. investors that while these terms are defined in, and permitted by, Canadian regulations, these terms are not defined terms under SEC Industry Guide 7 and not normally permitted to be used in reports and registration statements filed with the SEC.  "Inferred resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of a feasibility study or prefeasibility studies, except in rare cases.  The SEC normally only permits issuers to report mineralization that does not constitute SEC Industry Guide 7 compliant "reserves", as in-place tonnage and grade without reference to unit measures. U.S. investors are cautioned not to assume that any part or all of mineral deposits in this category will ever be converted into reserves. U.S. investors are cautioned not to assume that any part or all of an inferred resource exists or is economically or legally minable.

Safe Harbor for Forward-Looking Statements
This release and related documents may include "forward-looking statements" including, but not limited to, statements related to the interpretation of drilling results and potential mineralization, future exploration work at the Sleeper Gold Project and the Dunes Project and the expected results of this work. Forward-looking statements are statements that are not historical fact and are subject to a variety of risks and uncertainties which could cause actual events to differ materially from those reflected in the forward-looking statements including fluctuations in the price of gold, inability to complete drill programs on time and on budget, and future financing ability.  Paramount’s future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable securities laws. Words such as "believes" "plans" "anticipates" "expects" "estimates" and similar expressions should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including, but not limited to: uncertainties involving interpretation of drilling results, environmental matters, lack of ability to obtain required permitting, equipment breakdown or disruptions, and the other factors described in Paramount’s Annual Report on Form 10-K for the year ended June 30, 2010 and its most recent quarterly reports filed with the SEC.  Except as required by applicable law, Paramount disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this document.

Paramount Gold and Silver Corp.
Glen Van Treek, VP Exploration
Chris Theodossiou, Investor Relations
866-481-2233