Yukon-Nevada Gold Corp. - Jerritt Canyon

Projects Overview Jerritt Canyon

Overview SSX - Steer Complex Smith Recovery Process Reserves & Resources Exploration Overview Exploration History Technical Report Jerritt Canyon Map

Ketza River Manto Zone Ketza Shamrock Silver Valley Property Silver Bar South Wolf Property Money Property

Yukon-Nevada Gold Corp.
490-688 West Hastings Street
Vancouver BC V6B 1P1
Canada

Tel: 604.688.9427
Fax: 604.688.9426
Email: nicole@yngc.ca

History

In 1972, the first gold was discovered at the Jerritt Canyon District, with the first gold poured on July 4, 1981. Open pit mining occurred between 1981 and 1999. Portal-accessed, underground mining commenced in 1993 and continues today with the SSX-Steer Complex and the Smith mine. The Mahala deposit, located within the Smith mine, began commercial production in mid 2005. Since mining began, Jerritt Canyon has produced over 8 million ounces of gold.

Operations

None of the Jerritt Canyon mines exceed 1,000 feet in depth measured from the elevations at their portals. Underground mining uses low-profile 6-cubic-yard load/haul/dump tractors (LHD) loading 35- and 40-ton trucks for ore removal. Ground support typically uses rock bolts and shotcrete, with cemented back-fill in mined-out areas.

All underground ore is stacked near the mine portals for grade sampling. It is then transported in 150-ton haul trucks to the mill. Due to the sulfide refractory nature of Jerritt Canyon's ore, the mill feed is dried and roasted and gold is recovered using conventional carbon-in-leach processing. High quality gold doré bars are then shipped for commercial refining and sale.

SSX - Steer Complex

28% of 2007 gold reserves at Jerritt Canyon

Current Mining Methods

Conventional sublevel stoping
Blind bench stoping
Ramp bench stoping
Blind uphole stoping

The drift connecting the SSX and Steer mines was completed in late 2005, and the two mines are now referred to as the SSX-Steer Complex. By providing a secondary escape way and ventilation, this connection allowed commercial production from Steer to begin in 2005. The drift also allows the SSX-Steer deposits to share infrastructure in order to optimize production. The SSX- Steer connection also enables drill platforms to explore this prospective corridor.

The SSX deposit was discovered in the early 1990s following the structural trends between the Burns Basin and California Mountain deposits. Mining commenced in 1997. The deposit occurs 450 to 1,000 feet below the surface. It is currently, and has been in the last few years, the main gold producer at Jerritt Canyon. The SSX deposit is primarily structurally controlled by a network of northwest (e.g. South Boundary Fault, South Saval Trend), and northeast (e.g. Purple Fault, Saval Fault) structures. The intersection of the northeast and west-northwest structural trends remain a primary target for resource expansion. The westward extension of the South Boundary Dike and the Mahala resource to the east represent exploration opportunities.

Gold mineralization in the Steer portion of the SSX- Steer Complex has been identified in an area stretching approximately 3,000 feet east from the old Steer pit to halfway along the connection drift to SSX Zone 5. In the eastern portion of the Steer area, high-grade mineralization is associated with the Husky fault. The intersection of these dikes with the Hansen III unit and the Husky fault and its related structures offer excellent exploration potential.

Jerritt Canyon Underground Drill Hole Assay Data for Assays received before June 30th 2008

Smith

38% of 2007 gold reserves at Jerritt Canyon

Current Mining Methods

Conventional sublevel stoping
Blind bench stoping
Ramp bench stoping
Blind Uphole Stoping

The Smith Mine, accessed via a portal from the Dash open pit, was started in 1999 as the pit was being mined out. The Smith Mine complex consists of several mineralized areas that are accessed from the Smith portal, as well as East Dash to the east that will be accessed from a separate portal in the Dash pit.

Gold mineralization in the main Smith, Mahala and West Dash deposits is associated with the northeast trending Coulee Fault and west-northwest trending faults and dikes. In Zone 1, high-grade gold mineralization is hosted in the upper and middle portions of the Hansen Creek III unit within a northwest trending horst block between the South Graben fault and the 170 fault. Mineralization in Zones 2 and 3 is directly associated with west-northwest trending dikes. High-grade mineralization occurs within the Hansen Creek II and III units along the steeply dipping dikes.

Gold mineralization in the Mahala area is spatially associated with the west-northwest trending Mahala fault and associated dikes and favorable ore-host stratigraphy, including the Hansen Creek Formation and lower beds of the Roberts Mountains Formation. Mineralization at East Mahala occurs primarily in broad, Southeast-dipping lenses in the hanging wall of the Coulee Fault.

The West and East Dash deposits occur at the ends of the west-northwest trending Dash Fault system which formed the mineralization mined in the Dash pit. The West Dash deposit occurs at the intersection of the Coulee fault and the west-northwest trending Dash fault. West Dash is accessed through the Smith Portal. The East Dash deposit lies to the east of the Dash pit and will be accessed by a separate portal in the pit. At East Dash, most gold occurs in two lenses parallel to the Dash Fault and dipping to the northeast.

Recovery Process

The mineral processing operation at Jerritt Canyon is one of only three processing plants in Nevada that uses roasting in its treatment of refractory ores. Initially, Jerritt Canyon was designed to process oxide and mildly refractory gold ores. In 1989, the roasting circuit was added to the process for the treatment of highly refractory ores which are now being mined and processed at Jerritt Canyon.

The unit operations at the Jerritt Canyon processing plant are comprised of the following circuits:

Primary crushing;
Secondary crushing;
Fine ore drying;
Tertiary crushing;
Dry grinding;
Roasting;
Carbon-in-leach ("CIL") with cyanidation and carbon adsorption;
Carbon stripping;
Carbon reactivation;
Merrill-Crowe process using zinc cementation of gold and silver;
Precipitate refining;
Oxygen plant; and
Tailing impoundment.

Reserves & Resources

Summary

Table 1. JERRITT CANYON RESERVES
DECEMBER 2007

Deposit/Mine	PROVEN			PROBABLE			TOTAL
Deposit/Mine	K tons	oz/st	K oz	K tons	oz/st	K oz	K tons	oz/st	K oz
Smith	92.5	0.304	28.1	861.6	0.280	241.4	954.1	0.282	269.5
SSX	513.7	0.221	113.4	386.3	0.232	89.7	900.0	0.226	203.0
Saval	11.4	0.200	2.3	108.8	0.250	27.2	120.2	0.246	29.5
Starvation	-	-	-	571.6	0.282	161.3	571.6	0.282	161.3
Wright Window	-	-	-	32.6	0.227	7.4	32.6	0.226	7.4
Sub Total	617.6	0.233	143.7	1,961.0	0.269	527.0	2,578.6	0.260	670.7

Stockpiles	35.9	0.173	6.2	540.8	0.075	40.4	576.7	0.081	46.6

TOTAL	653.4	0.229	149.9	2,501.8	0.227	567.4	3,155.2	0.227	717.3

Table 2. JERRITT CANYON MEASURED, INDICATED & INFERRED RESOURCES
DECEMBER 2007

Deposit/Mine	MEASURED			INDICATED			MEASURED & INDICATED			INFERRED
Deposit/Mine	K tons	oz/st	K oz	K tons	oz/st	K oz	K tons	oz/st	K oz	K tons	oz/st	K oz
Murray	156	0.310	48	27	0.269	7	182	0.304	55	90	0.228	21
Murray Zone 9	-		-	211	0.277	58	211	0.277	58	62	0.209	13
SSX/Steer	1,815	0.255	462	746	0.269	201	2,561	0.259	663	959	0.236	227
Smith	588	0.303	178	649	0.256	166	1,237	0.278	344	534	0.221	118
Smith East	19	0.441	8	1,044	0.284	297	1,062	0.287	305	125	0.280	35
Saval	12	0.227	3	367	0.253	93	380	0.252	96	107	0.206	22
Starvation	-		-	697	0.287	200	697	0.287	200	25	0.252	6
Wright Window	-		-	98	0.156	15	98	0.156	15	19	0.229	4

Other Resources:
Pit Resources
Burns Basin Pit	-		-	30	0.134	4	30	0.134	4	-		-
California Mtn. Pit	-		-	8	0.115	1	8	0.115	1	-		-
Coyote Zone 10 Pit	-		-	-		-	-		-	20	0.104	2
Pie Creek Pit	-		-	190	0.157	30	190	0.157	30	28	0.142	4
Road Canyon Pit	-		-	149	0.143	21	149	0.143	21	74	0.131	10
Mill Creek	-		-	78	0.124	10	78	0.124	10	-		-
U/G Resources
Burns Basin	-		-	31	0.194	6	31	0.194	6	51	0.228	12
California Mtn.	-		-	32	0.377	12	32	0.377	12	9	0.330	3
Coyote Zone 10	-		-	45	0.212	10	45	0.212	10	3	0.184	0
MCE	-		-	4	0.201	1	4	0.201	1	8	0.189	1
Waterpipe II	-		-	-		-	-		-	37	0.206	8
West Mahala	-		-	197	0.218	43	197	0.218	43	130	0.206	27
Winters Creek	-		-	149	0.218	32	149	0.218	32	37	0.199	7

Sub Total	2,590	0.270	700	4,753	0.254	1,207	7,343	0.260	1,907	2,320	0.224	520

Stockpiles	36	0.173	6	818	0.059	48	854	0.064	54	-		-

Total All Sources	2,626	0.269	706	5,571	0.225	1,255	8,197	0.239	1,961	2,320	0.224	520

The 2007 year-end reserve estimate was calculated using a gold price of $580 per ounce, reflecting a three-year average gold price.

Jerritt Canyon resources and reserves were calculated by Messrs. Donald Colli and Robert (Chip) Todd, Manager of Mine Geology and Manager of Technical Services, respectively, under the supervision of Yukon-Nevada Gold's Executive Vice President - Exploration, Dorian L. (Dusty) Nicol. These individuals are qualified persons as defined by N.I. 43-101. The work has been reviewed and approved by Leah Mach and Landy Stinnet of SRK Consulting (US), Inc. who are the qualified persons for purposes of this news release. SRK Consulting (US), Inc. is preparing a 43-101 Technical Report which will include these results; it is anticipated that this full report will be available and released in April 2008.

Cautionary Note to U.S. Investors concerning estimates of Measured, Indicated and Inferred Resources

This document uses the terms "measured and indicated resources". The Company advises U.S. investors that while these terms are recognized and required by Canadian regulations, the SEC does not recognize them. 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.

This document also uses the term "inferred resources". The Company advises U.S. investors that while this term is recognized and required by Canadian regulations, the SEC does not recognize it. "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 or other economic study. U.S. investors are cautioned not to assume that any part or all of an inferred resource exists or is economically or legally minable.

Mineral Reserve Terminology: Canadian and U.S. Differences

The Company is organized under the laws of British Columbia, Canada. The mineral reserves and resources described in this Annual Report are estimates and have been prepared in compliance with National Instrument 43-101 of the Canadian Securities Administrators. The definitions of proven and probable reserves used in National Instrument 43-101 differ from the definitions in the United States Securities and Exchange Commission ("SEC") Industry Guide 7.

Exploration Overview

District Geology
The Jerritt Canyon deposits are typical of the Carlin-type deposit of micron to submicron-sized gold particles hosted primarily by carbonaceous, Paleozoic calcareous and sulfidic sedimentary rocks. Lesser amounts of ore are hosted by intermediate to mafic intrusive rock. The deposits often consist of several discrete pods or zones of mineralization whose location is controlled by intersections of major west-northwest and north-northeast structures that cut folded, permeable and chemically favorable host rocks. Locally, intrusive dikes that follow the northwest or northeast structures may be important host rocks. The combination of these structural and stratigraphic controls imparts a highly irregular shape to the ore zones, although most have more horizontal than vertical continuity depending upon the orientation of the host rocks. Gold in the Jerritt Canyon ore deposits occurs as free particles of intergranular, native gold, on or within pyrite, or in association with sedimentary carbonaceous material. Due to the sulfide and carbonaceous affinities, most of the gold deposits at Jerritt Canyon require fine grinding and oxidation to permit the gold particles to be liberated by standard, carbon-in-leach cyanidation.

Project Drilling
Exploration drilling programs typically consist of reverse circulation (RC) drilling at about 200-foot centers. The spacing is then reduced to about 140 feet and finally, to 100-foot centers or less. Surface core drilling will also augment the drilling programs. At the underground mines, definition drilling usually consists of core drilling on 50-foot centers from underground stations. Underground RC drilling (Cubex) is typically used for resource conversion and is drilled on 20- to 40-foot centers.

Tens of thousands of holes have been drilled on the Jerritt Canyon property over the years. The Murray Mine has over 22,000 holes with more than 2 million feet drilled; the Smith mine has over 5,000 holes with more than 1.25 million feet; the SSX mine has nearly 16,000 holes with 2.4 million feet of drilling.

Jerritt Canyon Drill Hole Assay Data for Assays received before July 1st 2008

Starvation Canyon
The discovery of high-grade mineralization at Starvation Canyon has been particularly exciting, as this is the first substantial gold deposit found in the southern part of the district -- an area considered to have similar geologic structures as the mines in the northern part. The mineralized zones that host the Starvation Canyon deposit have not been fully delineated. The thickness and grade of mineralization are comparable to the mineralization found previously at Jerritt Canyon.

Starvation Canyon is located on private land owned by Queenstake in the southwestern part of the Jerritt Canyon District. The gold mineralized zone at Starvation Canyon lies above the water table in the area of steep topography and could be easily accessed by portal from the hillside. As shown in the top diagram, mineralization is open in several directions.

Starvation Canyon drilling has identified al prospective 4 1/2-mile mineralized trend that includes Starvation Canyon and mineralized targets at Waterpipe II and Pie Creek.

At Starvation Canyon, the southern margin of the western mineralized zone is open. Along the southeast projection of the eastern zone, additional potential exists to the south and southeast. The northwest structure that appears to be the primary control for the Starvation Canyon resource could hold potential for additional clusters of mineralization both to the northwest and southeast. These areas will be followed up with step-out drilling.

Exploration History

The Jerritt Canyon district was originally explored by prospectors looking for antimony in the early 1900s. FMC Corporation, exploring for antimony in the 1970s, discovered gold occurrences similar to those in the nearby Carlin trend. In 1976, FMC, then known as Meridian Mining, formed a joint venture with Freeport Minerals to explore and develop the deposits. Mining commenced in 1981 at Jerritt Canyon with the North Generator open pit.

Since then, the operators of Jerritt Canyon conducted exploration programs for the identification and development of new mineralized areas. The Jerritt Canyon operation has had a history of exploration and discovery since the 1970s. Historically, most of the exploration efforts were concentrated at and around the existing underground mines in the northern part of the district. Several open pit deposits were discovered, developed and mined during the 1980s and 1990s, including North Generator, Alchem, Marlboro Canyon, Burns, Steer, Saval and Dash. Underground targets were also identified, and the first to be exploited was the West Generator underground deposit in 1993. The MCE, Smith and Steer deposits were more recent discoveries. The million-ounce Murray Mine unexpectedly was discovered by drilling an area being prepared for surface support facilities. The SSX deposit was discovered in the early 1990s by geologists following the structural trends between Burns Basin and California Mountain open pits. The SSX Mine produced its millionth ounce of gold in 2005, becoming the fifth millionth-ounce mine at Jerritt Canyon.

Greater exploration efforts in the southern part are being directed at Starvation Canyon. Yukon-Nevada's exploration efforts successfully grew and replaced reserves, net of production depletion, since acquiring the Jerritt Canyon operations in June 2007. The first gold reserves from the Starvation Canyon project and Mahala Basin were delineated in 2005 and added to in 2006 and 2007.

Jerritt Canyon Operations Technical Report

Prepared for Yukon-Nevada Gold Corp. by SRK Consulting (US), Inc.

April 2008

Download the Technical Report | Click Here [PDF 3.68 MB]

Jerritt Canyon Map