TORONTO, Feb. 10, 2016 /CNW/ - Anaconda Mining Inc.
("Anaconda" or the "Company") – (TSX: ANX) is pleased to report
that on February 5, 2016 (the
"Effective Date") it entered into an option agreement (the "Viking
Agreement") with Spruce Ridge Resources Ltd. ("Spruce Ridge"), to
acquire a 100% undivided interest in the Viking property
("Viking"), which contains the Thor-Trend Gold Deposit ("Thor
Deposit"). The Thor Deposit contains a Historical Mineral
Resource Estimate as summarized below:
Resource
Category
|
Cut-off
(g/t)*
|
Tonnes
|
Grade
(g/t)
|
Ounces of gold
(Au)
|
Indicated
|
1.0
|
937,000
|
2.09
|
63,000
|
Inferred
|
1.0
|
350,000
|
1.79
|
20,000
|
The Thor Deposit remains open for potential expansion along
strike near surface and at depth.
The Company also entered into a second option agreement (the
"Kramer Agreement") with Spruce Ridge to acquire a 100% undivided
interest in the Kramer Property ("Kramer"), which is contiguous to
Viking and contains numerous gold prospects and showings similar in
geological character and setting to the Thor Deposit.
Viking and Kramer are located near the communities of
Pollards Point and Sop's Arm in
White Bay, Newfoundland and
Labrador, approximately 180 km by
road (100 km by barge) from the Company's Pine Cove mill, and are
accessible via a 2.5 km forest road from provincially maintained
paved road networks (Exhibits A and B). The combined Viking and
Kramer properties encompass 4,025 hectares of highly prospective
mineral lands.
On January 29, 2016, Anaconda also
staked an additional 2,200 hectares of prospective mineral lands
contiguous to Viking and Kramer (Exhibit B). In total, the Company
now controls approximately 6,225 hectares of property in White Bay,
Newfoundland, similar in size to
the Point Rousse Project on the Ming's Bight Peninsula.
President and CEO, Dustin Angelo,
stated, "Our option of Spruce Ridge's gold properties is an
exciting transaction for Anaconda as it is the first step out from
the Point Rousse Project and will add significant resources to our
portfolio within striking distance of the Pine Cove mill. Our
intent is to process any ore mined from this property at the Pine
Cove mill so as to leverage our existing infrastructure. Beyond the
historical Indicated and Inferred Mineral Resources at Viking, we
are encouraged by the overall gold bearing potential of the entire
land package, including Kramer and the property staked by Anaconda.
Ultimately, we foresee simultaneously operating two large gold
mining projects at Point Rousse and Viking while processing their
ore at the Pine Cove mill."
John Ryan, President and CEO of
Spruce Ridge stated that, "we are pleased to have an agreement with
Anaconda that will advance the Viking and Kramer properties to the
benefit of shareholders of both companies. Anaconda has an
active mining operation within reasonable trucking or shipping
distance from Viking/Kramer and has demonstrated their ability to
operate successfully as evidenced from their track record at the
Point Rousse Project. This agreement will allow the potential
fast tracking of Viking towards production utilizing Anaconda's
existing infrastructure."
Near term exploration and evaluation plans
The Company plans to verify all available historical data, fully
integrate the data into its database, and complete an assessment of
the Thor Deposit and the exploration potential of the entire
project area. It will refine the Thor Deposit geological model to
incorporate the new geological model and ultimately generate a new
Mineral Resource Estimate. Contemporaneous with data and resource
model assessment, Anaconda will create a preliminary development
plan to evaluate the project viability based on leveraging the Pine
Cove mill.
Anaconda is planning a field program, based on the
aforementioned work, for early summer of 2016 to advance the
project. Additionally, metallurgical testing will be completed on
mineralized intervals from the Thor Deposit drill core to further
assess compatibility with the Pine Cove mill flowsheet.
Terms of the option and royalty agreements
The Viking Agreement: To earn a 100% interest in
Viking, the Company is required to make aggregate payments to
Spruce Ridge of $300,000 over a
five-year period based on milestones to production including a
final payment of $175,000 upon
commencement of commercial production. The Company can pay
all option payments at any time during the option period to earn
its 100% interest. In addition, the Company granted warrants
to Spruce Ridge to purchase 350,000 common shares of Anaconda at an
exercise price of $0.10 per share,
expiring three years from the Effective Date. Further, the Viking
Agreement provides for one-half of one percent (0.5%) Net Smelter
Returns royalty ("NSR") to Spruce Ridge on the sale of gold from
Viking.
The Kramer Agreement: To earn a 100% interest in
Kramer, the Company is required to make aggregate payments to
Spruce Ridge of $132,500 over the
five-year period, beginning with an initial payment of $12,500 on closing with increasing payments on
the anniversary of the Effective Date of the agreement. The Company
also issued 250,000 common shares of Anaconda. The Kramer Agreement
provides for a two percent (2%) NSR to Spruce Ridge on the sale of
gold from Kramer. The NSR is capped at two and one-half million
dollars ($2,500,000), after which,
the NSR will be reduced to one percent (1%). Anaconda is required
to spend a total of $750,000 in
qualified exploration expenditures on Kramer during the option
period.
Other agreements: Two previous NSR agreements held
by Altius Resources Inc. ("Altius") and a prospector, Paul Crocker, in relation to Viking will be
terminated upon Anaconda earning its 100% interest in Viking and/or
Kramer. These agreements will be replaced by new NSR agreements
that stipulate that the Company will pay Altius a 2.5% NSR granted
on Viking, a 1% NSR granted on Kramer and a 1.5% NSR granted on an
area of interest within 3 km of the combined Viking and Kramer
properties.
The Thor Deposit
The Thor Deposit hosts a Historical Mineral Resource Estimate as
defined by the National Instrument 43-101 Standards for Disclosure
for Mineral Projects and is not considered by the Company to be a
Current Mineral Resource, since Anaconda Qualified Persons have not
completed sufficient work to classify it as a Current Mineral
Resource. The Indicated and Inferred Resources referenced above are
taken from a technical report filed on SEDAR titled "MINERAL
RESOURCE ESTIMATE UPDATE FOR THE THOR TREND GOLD DEPOSIT, NORTHERN
ABITIBI MINING CORP., White Bay Area, Newfoundland and Labrador, Canada, Latitude 49o 42'
N Longitude 57o 00' W." prepared for Northern
Abitibi Mining Corp. by Dr. Shane
Ebert, P. Geo. and Gary
Giroux, P. Eng. MASc., December 30,
2011.
The Historical Mineral Resource Estimate of the Thor Deposit is
based on 109 diamond drill holes totaling 15,574 m and 74 lines of
surface channel samples cut from trenches using a diamond saw
(Exhibit C). Gold mineralization was constrained within a
3-dimensional geological solid built using Gemcom software. Gold
assays within the mineralized solid were capped at 66.0 g/t Au
while those outside the solid were capped at 4.0 g/t Au. Drill hole
assay samples were composited into 2.5 m intervals and a block
model with 5m x 5m x 5m block size was created. Gold grades were
interpolated into all blocks, by a combination of ordinary and
indicator kriging.
The Company considers the NI 43-101 report to be relevant and
reliable given that the report was published recently and that no
additional work of significance has been completed since the
issuance of the Historical Mineral Resource Estimate.
In addition to the Historical Mineral Resource Estimate, other
historical exploration efforts on the Viking and Kramer properties
include: 128 holes of diamond drilling totaling 18,620.6 m on
Viking and 28 holes totaling 3,650.3 m on Kramer; excavation of 62
trenches on Viking and 5 trenches on Kramer and associated channel
sampling; high-resolution airborne magnetic and electromagnetic
geophysical surveying; ground induced polarization, magnetic and
VLF surveys, rock and soil sampling and geological mapping.
This news release has been reviewed and approved by
Paul McNeill, P. Geo., VP
Exploration with Anaconda Mining Inc., a "Qualified Person", under
National Instrument 43-101 Standard for Disclosure for Mineral
Projects.
ABOUT ANACONDA
Headquartered in Toronto,
Canada, Anaconda is a growth oriented, gold mining and
exploration company with a producing project, called the Point
Rousse Project, and approximately 6,300 hectares of exploration
property on the Ming's Bight Peninsula located in the Baie Verte
Mining District in Newfoundland,
Canada. Since 2012, Anaconda has increased its property
control by ten-fold on the peninsula. It is currently exploring
three primary, prospective gold trends, which have approximately 20
km of cumulative strike length and include three deposits and
numerous prospects and showings, all within 8 kilometres of the
Pine Cove mill. The Company's plan is to discover and develop more
resources within the project area and double annual production from
its current rate of approximately 15,000 ounces to 30,000 ounces.
Anaconda also controls approximately 6,225 hectares of property in
White Bay, Newfoundland,
approximately 180 km via road (100 km by barge) from the Pine Cove
mill. The White Bay property contains the Thor-Trend gold deposit
and other gold prospects and showings.
FORWARD LOOKING STATEMENTS
This document contains or refers to forward-looking
information. Such forward-looking information includes, among other
things, statements regarding growth and is based on current
expectations and assumptions of management that involve a number of
business risks and uncertainties. Factors that could cause actual
results to differ materially from any forward-looking statements
include, but are not limited to: the expectations of the Company in
expanding mineral resources and project mine life and the timing
thereof, current and future market trends and growth opportunities
and whether the Company will be able to capitalize upon them.
Forward-looking statements may include words such as "plans,"
"may," "estimates," "expects," "indicates," "targeting,"
"potential" and similar expressions. These forward-looking
statements are based on current expectations and are subject to
significant risks and uncertainties, including the risks factors
outlined in the Company's latest annual information form and other
continuous disclosure documents filed at www.sedar.com, and other
factors that could cause actual results to differ materially from
expected results. Readers should not place undue reliance on
forward-looking statements. These forward-looking statements are
made as of the date hereof and the Company assumes no
responsibility to update them or revise them to reflect new events
or circumstances, except as required by law.
Company website: www.anacondamining.com
SOURCE Anaconda Mining Inc.