Mr. Trey Wasser reports
ELY GOLD ROYALTIES (TSXV: ELY) (OTCQB: ELYGF) ANNOUNCES THE PURCHASE OF ADDITIONAL CLAIMS AT PRODUCING GOLD BAR MINE, NEVADA
Ely Gold Royalties Inc., through its wholly owned subsidiary, Nevada Select Royalty Inc., has signed a binding term sheet with a private individual to purchase eight unpatented mining claims in Eureka county, Nevada. The claims are currently leased to a subsidiary of McEwen Mining Inc. and the agreement includes an assignment of the leases to Ely Gold. The agreement is subject to the signing of definitive agreements and approval of the TSX Venture Exchange.
Under the terms of the agreement, Ely Gold will:
- Purchase two HNT claims and assume the corresponding lease;
- Purchase six JAM claims and assume the corresponding lease;
- Pay the seller $125,000 (U.S.) at closing;
- Issue 100,000 share warrants to the seller.
The warrants will expire two years from closing and each warrant will allow the seller to purchase one share of Ely Gold common stock at a price of 77 cents. The annual lease payment covering the HNT claims is $5,000 (U.S.) and the annual lease payment covering the JAM claims is $7,000 (U.S.). Both leases provide for a 2.0-per-cent net smelter returns royalty at current gold prices.
Trey Wasser, president and chief executive officer of Ely Gold, commented: "This transaction gives us two additional properties in the Nevada Gold Bar complex, and with the addition of the HNT and JAM claims we now hold a total of six properties and royalties at Gold Bar. We believe that both claim blocks contain excellent targets and represent resource expansion potential for McEwen Mining's Gold Bar producing mine."
The HNT claims
The HNT claims are located 3,500 feet northwest of the Gold Bar South deposit owned by McEwen Mining and cover part of the northwest extension of the Gold Bar South deposit. Large jasperoid bodies developed along the McColley Canyon-Lone Mountain dolomite contact and along northeast-trending faults contain highly anomalous gold and gold pathfinder elements in the area. The heart of the historic deposit has been tested by mostly vertical drilling which produced near-surface intercepts of 38.1 metres of 1.71 grams per tonne Au and 33.53 metres of 1.96 g/t (HNT drill results reported in a technical report by Mineral Resources Development Inc., February, 1995).
The Jam claims are dominated by a linear series of prominent cliff-forming jasperoid outcrops that have developed along the northwest-trending Wall fault.
The Wall fault has juxtaposed rocks of the Ordovician Vinini formation with the lower plate carbonate rocks of the Devonian Devils Gate limestone. The jasperoids are locally highly anomalous in gold with values as high as 1.56 g/t gold in outcrop. Gold mineralization found to date is confined to structural jasperoids along the Wall fault, the Upper Denay limestone host rocks intersected in the drilling were strongly decalcified and contain elevated gold pathfinder elements. McEwen recently reported drilling a deep hole along the Wall fault at Pot Canyon (see MUX press release dated Oct. 15, 2019). McEwen is currently testing lower plate stratigraphy along the Wall fault and believes it may be the extension of the Cortez fault to the northwest.
Stephen Kenwood, PGeo, is director of the company and a qualified person as defined by National Instrument 43-101. Mr. Kenwood has reviewed and approved the technical information in this press release.
About Ely Gold Royalties Inc.
Ely Gold Royalties is a Vancouver-based, junior royalty company with development assets focused in Nevada and Quebec. Its current portfolio includes 37 deeded royalties and 22 properties being sold to third parties. Ely Gold's royalty portfolio includes producing royalties, fully permitted mines and development projects that are at or near producing mines. The company is actively seeking opportunities to purchase existing third party royalties for its portfolio and all the company's option properties are expected to produce royalties, if exercised.
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