Merc Agrees to Acquire Colomac Gold Mine Consolidating Indin Lake Gold Camp
15 Dicembre 2011 - 10:11AM
PR Newswire (Canada)
www.mercinternational.ca TORONTO, Dec. 15, 2011 /CNW/ - Merc
International Minerals Inc. ("Merc") is pleased to announce it has
entered into an agreement to acquire the mineral claims and leases
of the former producing Colomac Gold Mine ("Colomac") in the
Northwest Territories ("NWT") from Aboriginal Affairs and Northern
Development Canada ("AANDC"). Colomac represents a rare opportunity
as a past producer and under-developed gold deposit with
exploration potential. Merc believes there is an opportunity to
develop resources at Colomac (as historic open pit mining was
limited to less than 200 metre vertical depths and only one of five
known deposits was developed). All deposits at Colomac remain open
to depth and laterally. Highlights: -- On closing, Merc will
acquire 100% interest in the Colomac property, which includes the
past producing Colomac Main Zone, four surrounding gold deposits,
and several gold showings on the approximately 32,000 acre
property. -- The reclaimed Colomac open pit mine historically
produced 527,908 ounces of gold with an average head grade of 1.66
grams per tonne gold ("g/t Au"). -- Acquisition consolidates Merc's
Indin Lake land package of approximately a quarter million acres or
90% of the entire Indin Lake Gold Camp. -- ACA Howe International
Ltd. ("ACA Howe") has been assisting Merc in its due diligence and
is currently preparing a NI 43-101 technical report and mineral
resource estimate for the Colomac property, which will incorporate
the five known gold deposits. -- Colomac's five deposits are open
in all directions; only one has been mined. David Wiley, Merc
President and CEO, commented, "The acquisition of the former
producing Colomac mine will represent a strategic milestone and
completes Merc's Indin Lake Gold Camp land package by adding a
property that is entirely surrounded by our existing claims. We
have obtained and analyzed historical data that indicates the
potential for a substantial amount of gold to be present within the
Colomac deposits. To that end, we have engaged ACA Howe, who
visited the site in October 2011 and has been assisting in our due
diligence, to complete a NI 43-101 technical report and mineral
resource estimate on the property for early 2012. This next year
will be a very exciting time for the company as we initiate a new
and aggressive growth strategy focusing on increasing ounces at
Colomac and advancing our satellite deposits towards a similar
status." In consideration for the conveyance of the Colomac claims
and leases, Merc will commit to reclaim three disturbed historic
exploration sites near the Colomac mine within Merc's surrounding
Indin Lake land package. Reclamation will be carried out on behalf
of AANDC to a maximum of $5,000,000. At closing, Merc will post
security of $5,000,000 (the "Security") in favour of AANDC to
secure Merc's obligation to perform the required reclamation. Merc
will not be assuming the reclamation liabilities directly. The
Security will be returned to Merc upon the completion of
remediation activities to the satisfaction of an independent third
party engineer. AANDC has substantially completed the reclamation
of Colomac, with only adaptive management and monitoring phases of
the project remaining. Merc is not responsible for any historical
environmental liabilities associated with Colomac. David Wiley
continued, "This transaction benefits Merc shareholders by adding a
bona fide past producing mine to our asset portfolio, while also
allowing AANDC to realize their objectives of expediting historic
remediation obligations, providing economic development, and
creating job opportunities for the local First Nations
communities." Closing of the transaction is expected to occur in
late January 2012. Merc has entered into negotiations with
third parties for a $5,000,000 loan, which Merc intends to use to
post the Security required to serve its obligations under the
agreement with AANDC. About Colomac The Colomac mine is located 220
kilometres northwest of Yellowknife, NWT, within the central
portion of the Indin Lake greenstone belt. Access is by winter road
from Yellowknife for approximately three months each year or year
round by chartered aircraft to a 5,000 foot airstrip at the Colomac
mine site. Merc's Indin Lake claims and leases (Figure 1) surround
the property on all sides forming a contiguous land package. Five
separate gold deposits makeup the Colomac property: Colomac Main,
Grizzly Bear, Goldcrest, Dyke Lake, and 24/27. With the addition of
Colomac, Merc has consolidated over 20 continuous kilometres of
mineralized structure (Figure 2) that hosts 9 gold deposits (5 at
Colomac, North Inca, Diversified, Lexindin, and # 3). To the north
the mineralized structure deviates sharply to the west and hosts
several gold showings over an additional 18 kilometres. History
Gold was initially discovered at Colomac in 1945. In 1990, Neptune
Resources Corp. ("Neptune") put the property into production, but
shut down in 1991 due to unfavourable gold prices after producing
approximately 139,000 ounces. Royal Oak Mines Inc. ("Royal Oak")
acquired Colomac from Neptune in April 1993. Royal Oak recommenced
stripping operations in March 1994, with first gold production in
July 1994. Royal Oak closed the mine in December 1997 citing low
gold prices and subsequently filed for court protection from its
creditors under the Companies' Creditors Arrangement Act in April
1999 in April 1999. AANDC became the owner of Colomac by way of
Court Order dated December 13, 1999 following the receivership of
Royal Oak and its related companies and proceeded to complete the
required remediation for the site. All mining and milling
facilities were removed from the site subsequent to AANDC taking
control of the property. During its peak, Royal Oak employed over
250 workers on the Colomac site. Production statistics are
presented in Table 1. Table 1. Colomac ProductionHistory Head Cash
Average Year Ounces Tonnes Grade Recovery Cost/oz Gold Produced
Milled (g/tonne) (US$) Price (US$) 1990 64,500 1,040,000 1.89 90%
300 384 1991 74,100 1,131,000 2.19 94% NA 362 1994 40,568 985,091
1.58 87% NA 384 1995 117,646 2,725,388 1.61 92% 383 384 1996
122,416 3,013,156 1.58 87% 370 388 1997 108,678 2,906,081 1.51 85%
354 331 Total: 527,908 11,800,716 1.66 89% General Geology
Colomac's five known gold deposits lie within a north striking,
steeply dipping, Archean greenstone belt of deformed sedimentary
and intermediate to ultramafic volcanic rocks. Deposits appear in
two distinct geological settings with the Colomac Main, Goldcrest,
and Dyke Lake deposits hosted within quartz-feldspar porphyry
dykes, whereas the Grizzly Bear and 24/27 deposits occur near or
within the sedimentary/volcanic rock contact. Colomac Main Deposit
All historic gold production has been extracted from the Colomac
Main Deposit, which occurs in a north-south striking,
quartz-feldspar porphyry dike approximately 6 kilometres long and
50 metres wide bounded by diorite and andesite. Mineralization is
predominantly free gold spatially associated with quartz-carbonate
veining and minor sulphides. During deformation, the dyke behaved
as a competent unit enclosed within more ductile rocks, thus
representing the classic competency contrast condition present in
many Archean lode gold camps. This has led to the preferential
emplacement of gold-bearing veins within the quartz-feldspar dyke.
Figure 1 - Merc Indin Lake Land Package
(http://files.newswire.ca/926/Merc_Figure_1_Dec_15.pdf) Figure 2 -
Indin Lake Mineralized Structure with Colomac
(http://files.newswire.ca/926/Merc_Figure_2_Dec_15.pdf) About Merc
International Minerals Inc. Merc is a Canadian-based exploration
company focused on acquiring and developing gold mineral properties
in the NWT. Its primary land position covers 209,763 acres or
84,888 hectares in the Indin Lake Gold Camp, located approximately
200 kilometres north of Yellowknife, NWT. Since January 2011 Merc
has systematically increased its land position through staking and
acquisitions of claims and leases that comprise a majority of the
Indin Lake greenstone belt. Upon the closing of the
acquisition of Colomac from AANDC, Merc's land position will
increase in size to approximately 242,000 acres or 98,000
hectares. In 2011, Merc completed 11,929 metres of diamond
core drilling; the comprehensive assay results for Phase I and II
of the drill program were previously reported and are available on
the Merc website. Selected results from the 2011 drill program are
presented in Table 2 below: Table 2. Selected Drill
ResultsfromMerc's2011DrillProgram (Previously Reported) Core Drill
From To Length* Hole (metres) (metres) (metres) g/tAu NI11-02 96.75
123.00 26.00 6.86 incl 100.30 103.75 3.45 44.34 incl 100.80 102.75
1.95 78.30 DV11-09 45.50 48.50 3.00 65.35 incl 46.50 47.50 1.00
193.75 incl 46.50 47.00 0.50 260.00 65.80 71.00 5.20 12.90 incl
66.30 69.15 2.85 22.12 incl 68.75 69.15 0.40 138.50 NI11-04 49.60
66.50 16.90 6.08 incl 49.60 53.04 3.44 22.07 incl 50.10 50.60 0.50
103.50 DV11-02C 205.00 216.75 11.75 7.23 incl 205.00 212.40 7.40
11.38 incl 208.75 212.40 3.65 21.66 NI11-04B 51.50 88.50 37.00 2.29
incl 51.50 68.00 16.50 4.20 incl 63.00 65.00 2.00 15.72 * Lengths
are reported as core lengths. True widths are unknown at this time
The technical information in this news release was reviewed and
approved by Merc Director, Dr. Michael J. Byron, a Qualified Person
under NI 43-101. Historical information was obtained from previous
Royal Oak Annual Reports, Royal Oak geology and exploration
reports, and Metals Economics Group data. Neither TSX Venture
Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements Certain information set forth in this
news release may contain forward-looking statements that involve
substantial known and unknown risks and uncertainties. These
forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond the control of Merc,
including, but not limited to, the impact of general economic
conditions, industry conditions, volatility of commodity prices,
risks associated with the uncertainty of exploration results and
estimates, currency fluctuations, dependency upon regulatory
approvals, the uncertainty of obtaining additional financing and
exploration risk. Readers are cautioned that the assumptions used
in the preparation of such information, although considered
reasonable at the time of preparation, may prove to be imprecise
and, as such, undue reliance should not be placed on
forward-looking statements. This press release is not, and is not
to be construed in any way as, an offer to buy or sell securities
in the United States. SOURCE Merc International Minerals
Inc. PDF with caption: "Figure 1 - Merc Indin Lake Land Package".
PDF available at:
http://stream1.newswire.ca/media/2011/12/15/20111215_C7239_DOC_EN_8299.pdf
PDF with caption: "Figure 2 - Indin Lake Mineralized Structure with
Colomac". PDF available at:
http://stream1.newswire.ca/media/2011/12/15/20111215_C7239_DOC_EN_8300.pdf
Merc International Minerals Inc. CONTACT: David Wiley, President
and CEO Daniel Boase,Investor RelationsMerc International Minerals
Inc. First CanadianCapital Corp.(647) 260-1247 (416) 742-5600
ext232 (416) 363-4567 (FAX)
email:dboase@firstcanadiancapital.comEmail:
dwiley@mercinternational.ca
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