16:09:52 EDT Thu 22 Oct 2020
Enter Symbol
or Name
USA
CA



Login ID:
Password:
Save
Blue Lagoon Resources Inc
Symbol BLLG
Shares Issued 33,022,800
Close 2020-03-02 C$ 1.20
Recent Sedar Documents

Blue Lagoon has Metal Mountain project info

2020-03-02 21:00 ET - News Release

Mr. Rana Vig reports

BLUE LAGOON PROVIDES UPDATE ON TRANSACTION WITH METAL MOUNTAIN RESOURCES INC.

Blue Lagoon Resources Inc. has provided additional technical information regarding the mineral projects of Metal Mountain Resources Inc. The company previously announced on Feb. 27 that it had entered into a binding letter agreement to acquire 100 per cent of the outstanding shares of Metal Mountain, a private B.C. company.

Metal Mountain holds a 50.84-per-cent interest in Gavin Mines Inc., which, in turn, holds a 100-per-cent interest in the Dome Mountain mine, located near the town of Smithers in northwest British Columbia. Blue Lagoon also has a binding letter of intent with AGC Investments Inc., a private company which holds a 27.44-per-cent interest in Gavin Mines, whereby Blue Lagoon may acquire AGC's interest on closing of the acquisition of Metal Mountain.

With the acquisition of Metal Mountain's 50.84-per-cent interest and AGC's 27.44-per-cent interest, Blue Lagoon will hold a total of 78.28 per cent interest in the Dome Mountain mine.

Additionally, Metal Mountain also holds a 100-per-cent interest in the Big Onion property, a porphyry copper project located 16 kilometres east of the town of Smithers and consisting of 13 contiguous mineral claims comprising a total area of 4,493 hectares. The company will provide additional information on the Big Onion project in subsequent news releases.

Dome Mountain project info and historical estimates

The Dome Mountain project is the subject of a National Instrument 43-101 technical report entitled "Technical Report on the Dome Mountain Gold-Silver Project dated April, 2010," prepared by Gary Giroux, PEng, Giroux Consultants Ltd., for Gavin Mines. The technical report provides the following historical resource estimate for the Boulder vein system based on 285 surface diamond drill holes and 37 underground diamond drill holes.

        HISTORICAL INDICATED RESOURCE WITHIN THE MINERALIZED VEINS

Au cut-off    Tonnes>cut-off          Grade>cut-off       Contained metal 
(g/t)         (tonnes)             Au (g/t)   Ag (g/t)   Au (oz)    Ag (oz)

4.00          143,000                 14.76     72.83    67,900    334,800 
5.00          138,000                 15.10     73.93    67,000    328,000 
6.00          133,000                 15.46     75.36    66,100    322,200 

 
         HISTORICAL INFERRED RESOURCE WITHIN THE MINERALIZED VEINS

Au cut-off     Tonnes>cut-off            Grade>cut-off       Contained metal 
(g/t)          (tonnes)               Au (g/t)   Ag (g/t)   Au (oz)   Ag (oz)

4.00           173,000                  12.43      57.03    69,100   317,200 
5.00           154,000                  13.42      60.63    66,500   300,200 
6.00           137,000                  14.43      64.49    63,500   284,000 

This resource occurs principally above the 1,290 level and has been adjusted to remove the volumes previously mined. The 2010 historical resource estimate is considered historical in nature by the company, is provided for background information purposes only and is not a current resource estimate due to significant additional exploration work conducted subsequent to the date of the report. A qualified person (as defined in NI 43-101) has not done sufficient work to classify the historical estimate as a current mineral resource. The company is not treating the historical estimate as a current mineral resource.

Subsequent to the 2010 historical resource estimate, Gavin Mines conducted 7,210 metres of infill drilling in 2016 to upgrade the inferred resource. Four new veins were discovered within the Boulder vein system during the 2016 drill program. The 2016 drilling program added 330 metres of strike length to the Boulder vein, which remains open along strike to the west and at depth.

Gavin Mines engaged Roughstock Mining Services LLC of Bozeman, Mont., to prepare a non-NI 43-101 resource estimate for the Boulder vein system for internal use, based on the additional data from the 2016 drill program.

       HISTORICAL DOME MOUNTAIN MINE INDICATED RESOURCE 
     AT 3.42 G/T CUT-OFF (UNDILUTED) AS AT DEC. 30, 2017

                    Tonnes   Grade (g/t)      Grams    Ounces

Boulder vein       164,735        12.76   2,102,654    67,601
Boulder East vein    8,736        22.22     194,137     6,241 
Total              173,471        13.24   2,296,791    73,843

       HISTORICAL DOME MOUNTAIN MINE INFERRED RESOURCE 
     AT 3.42 G/T CUT-OFF (UNDILUTED) AS AT DEC. 30, 3017

                     Tonnes   Grade (g/t)      Grams    Ounces   

Boulder vein        171,611         8.96   1,538,017    49,448 
Boulder East vein   166,852         8.17   1,362,590    43,808 
Argillite vein       75,486        12.97     979,050    31,477 
Boulder HW vein      46,079         7.62     351,222    11,292 
Total               480,028         9.20   4,230,879   136,025

Blue Lagoon does not consider the 2016 historical resource estimate to be a current resource as defined in National Instrument 43-101. While Blue Lagoon believes the information to be generally reliable, Blue Lagoon has conducted only preliminary technical due diligence on the Dome Mountain mine, has not conducted the work necessary to independently verify the resource estimate, and specifically has not conducted a comprehensive review of the drill sample data used in the estimate or other analysis necessary to confirm the cut-off grade and other factors used in calculating the resource, including the method of calculation of the resource. Readers should not treat the 2016 historical resource estimate as a current mineral resource. The historical estimate is a non-NI 43-101 estimate, was not, as such, prepared in compliance with NI 43-101, and does not use the categories or procedures required by CIM (Canadian Institute of Mining, Metallurgy and Petroleum) best practice guidelines for mineral resources and mineral reserves or CIM definitions for mineral resources.

Milling agreement

In March, 2017, Gavin Mines entered into a toll milling agreement with Nicola Mining Inc. to provide for off-site milling and concentrating. Dome Mountain ore will be trucked and processed at this off-site mill owned by Nicola Mining, located in Merritt, B.C., which has a capacity of processing 250 tonnes per day. Mill recoveries are based on a scoping-level metallurgical program, which was conducted on muck samples from the Dome Mountain mine in 2010 and a test run of 6,690 tonnes of material that was run through the Nicola mill in 2016 at a grade of 8.75 grams per tonne, with a 95.2-per-cent gold recovery.

The Dome Mountain mine

The Dome Mountain mine includes a past-producing mine on tenures consisting of 42 contiguous mining claims and one mining lease totalling 10,970 hectares, located approximately 38 kilometres east of the town of Smithers in northwest British Columbia. The Dome Mountain area has a long history of exploration that resulted in the discovery of numerous gold-bearing quartz-carbonate veins. Gold mineralization was first located on the property in the late 1800s, and considerable surface and underground work was done in 1923 to 1924. Resumption of exploration in the 1980s led to the discovery of the Boulder vein system in 1985. Underground mining was initiated in August, 1991, by Timmins Nickel Inc. and its joint venture partner, Habsburg Resources Inc., and ceased in May, 1993. During this period, 43,900 tonnes at an average grade of 12.0 grams per tonne gold were reportedly mined from shrinkage stopes accessed from trackless drift developments on the 1,290 and 1,370 levels.

Expenditures on the mine by past operators, including Gavin Mines, Timmins and Noranda, have totalled in excess of $68-million, $28-million of which was spent by Gavin in the past 12 years. Mine permitting and significant infrastructure construction and underground development were completed on the mine between 2010 and 2012, including about 75 per cent of the planned underground development necessary for commencing production from the site. The Dome Mountain project holds a mining permit and environmental management act permit (EMA), providing for up to 75,000 tonnes annually.

The infrastructure and underground development completed during that period includes:

  • Mine dry/office building;
  • Electrocoagulation water treatment plant;
  • Water and sewer for all surface facilities;
  • Pipelines system for mine water;
  • Mechanics shop;
  • Electrical work into the mine;
  • Fuel storage and distribution system;
  • Major earthwork projects completed;
  • Underground development.

The scientific and technical data contained in this news release were prepared and reviewed by William Cronk, PGeo, a qualified person as defined in NI 43-101 and a consultant to the company.

We seek Safe Harbor.

© 2020 Canjex Publishing Ltd. All rights reserved.