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Pistol Bay Mining Inc (3)
Symbol PST
Shares Issued 50,833,822
Close 2019-09-03 C$ 0.04
Market Cap C$ 2,033,353
Recent Sedar Documents

Pistol Bay options Fredart-Gerry Lake to Belmont

2019-09-04 00:40 ET - News Release

Also News Release (C-BEA) Belmont Resources Inc (4)

Mr. Charles Desjardins of Pistol Bay reports

PISTOL BAY OPTIONS OUT FREDART-GERRY LAKE PROPERTIES, RED LAKE, ONTARIO

Subject to the approval of the TSX Venture Exchange, Pistol Bay Mining Inc. has entered into an option agreement whereby Belmont Resources Inc. will option from Pistol Bay its Fredart-Gerry Lake properties in Red Lake, Ont.

Fredart/Gerry Lake property acquisition, Red Lake mining division

Pistol Bay is pleased to announce that it has entered into a mineral property acquisition agreement with Belmont Resources on its Fredart-Gerry Lake and several adjoining claim groups in the Confederation Lake greenstone belt, approximately 70 kilometres southeast of Red Lake, Ont. The Arrow zone-Garnet Lake, an adjoining claim block, also owned by Pistol Bay, contains an inferred mineral resource (2017 National Instrument 43-101) containing 2.1 million tonnes of 5.78 per cent zinc, 0.72 per cent copper, 195 grams per tonne silver and 0.60 g/t gold as filed on SEDAR -- September, 2017. The geological setting of the Fredart and associated claims is similar to the Garnet Lake claim area.

The Fredart property had 124 drill holes between 1956 and 2003, totalling 22,500 metres. Additional drilling on the western extension of the Fredart trend and the Joy-Caravelle area has not been compiled yet. The copperlode A or Fredart zone deposit has a historical mineral resource of 425,000 tonnes grading 1.56 per cent copper. This historical resource estimate does not comply with the standards of NI 43-101 and has not been reviewed by a qualified person. The zone was drill tested to a depth of approximately 200 metres over a length of 350 metres, and was reported as being open at depth. Only portions of the drill holes were assayed for gold, due to the low price of gold at the time. The area was also explored for molybdenum in the 1970s, and samples containing up to 1.46 per cent Mo were reported.

Access to the area is by all-weather roads and a first-class gravel road for 40 kilometres from the town of Ear Falls, along the length of the property. Local resources include the availability of skilled labour; a 115-kilovolt transmission line from Ear Falls hydroelectric generating station to Pickle Lake and Musselwhite, which crosses the property; natural gas at Ear Falls; and water readily available throughout the area.

The Fredart property and additional claim units comprise 406 mining claims with an area of approximately 6,700 hectares (16,500 acres). It covers a 17-kilometre length of the Confederation Lake greenstone belt. It includes two substantial mineral deposits and a number of mineralized drill intersections that are ready for follow-up drill testing. Mineralization on the property is of volcanogenic massive sulphide (VMS) type, dominated by zinc, copper and silver, with occasional associated gold values and areas drilled but untested for gold. The mafic-dominated part of the belt hosts an iron formation, which defines the Fredart-Gerry Lake favourable horizon. Iron formations are very often associated with gold mineralization.

The property is 25 kilometres northeast of the Dixie property -- owned by Great Bear Resources Ltd. -- that has been reporting high-grade gold intersections, and its pace of discoveries has accelerated. Numerous other junior venture companies have been exploring the area, which is becoming one of the most active mining camps in Ontario.

In 2017, a VTEM Plus (versatile time domain electromagnetic Plus) survey was completed, which covers most of the greenstone belt. Airborne magnetics and electromagnetic anomalies are superimposed on the Ontario government surveys. Mag from the VTEM survey suggests the presence of granitic intrusions below surface in the northeast part of the Fredart area. The VTEM survey revealed two, or even three, parallel conductive responses over large parts of the Fredart-Gerry Lake trend.

Also included in the claim block is the Joy-Caravelle area. This western end of the property area contains multiple zones of Zn-Cu VMS deposits in a felsic-dominated part of the belt. Drill hole assays reported were as high as 21.6 per cent Zn and 0.13 per cent Cu over 0.25 metre; 17.17 per cent Zn and 0.28 per cent Cu over 0.60 metre; and 4.01 per cent Cu over 3.55 m, to name a few. Most of the drill holes were not assayed for gold. The Joy North claim has an undrilled 1,100-metre-long conductor, which is at a different stratigraphic horizon from the Fredart-Gerry Lake trend, and is unexplored.

Terms of the option

The option terms over a three-year period are as follows.

For a 65-per-cent interest:

  • $40,000 cash and 1.5 million shares upon exchange approval;
  • $50,000 cash and 1.5 million shares -- first-year anniversary of exchange approval;
  • $50,000 cash and 1.0 million shares -- second-year anniversary of exchange approval.

Belmont can earn an additional 10-per-cent interest (total 75 per cent) upon completion of second-anniversary obligations by payment of $200,000 in cash. Belmont and Pistol Bay would then enter into a joint venture agreement. A royalty of 2-per-cent net smelter returns (NSR) is payable to Glencore PLC on all the claims except the Fredart claims, where a 2-per-cent NSR royalty is payable to Perry English, with a $10,000 annual advance royalty payment to Mr. English.

Colin R. Bowdidge, PhD, PGeo, and a qualified person as defined by National Instrument 43-101, has reviewed and approved the above technical information in this news release.

About Pistol Bay Mining Inc.

Pistol Bay Mining is a diversified junior Canadian mineral exploration company with a focus on zinc and base metal properties in North America. The company is also actively pursuing the right opportunity in other resources to enhance shareholders value.

We seek Safe Harbor.

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