Pistol Bay Mining Inc. recently announced that it has struck an option agreement with 1544230 Ontario Inc. conditional on TSX Venture Exchange approval, to purchase a 100% right, title, and interest in and to 141 mining cells situated in the Pakwash Lake Area in the Red Lake Mining District, Ontario.
The 7130-acre properties are situated east and south of Great Bear Resources recent discovery.
The company is excited about the additional prospects for gold in the vicinity of the recent Great Bear Resources discovery. We believe there is considerable potential for gold on our Confederation Lake side of the Red Lake Mining district as well as the known historic resources of silver, copper, and zinc. Many of the historic drill holes in Confederation Lake were not assayed for gold.
Charles Desjardins, President and CEO, Pistol Bay
The property has two individual claim blocks. The first claim group is called the Pakwash East Block. It includes 35 cells, with an area of about 716 hectares (1,760 acres). It lies 12.5 km southeast of the Great Bear Resources Dixie property, connecting a 9,650-hectare claim group registered to Great Bear Resources. It is traversed by provincial Highway 105, a natural gas pipeline and a 115 kV transmission lines.
According to published geological maps, the property is underlain by metasedimentary rocks and granitic intrusions. Although it formed a portion of the Laurentian Goldfields Inc. Goldpines project, the sole exploration reported in the area of the Pakwash East Block was an airborne magnetic and VLF-EM survey.
The second claim group is called the Pakwash North Block, comprising 106-cells, 2,174-hectare (5,370 acres). It is located 21 km southeast of the Dixie Lake gold discovery currently being investigated by Great Bear Resources Ltd, and 44 km southeast of the town of Red Lake. It can be reached through old forestry access roads leading from provincial highway 105, as well as by boat through Pakwash Lake and the Chukuni and English Rivers.
The Pakwash North Block is located in an area of metasedimentary rocks of the English River terrain, including a range of granitoid intrusives, and straddles a key structure—the Sydney Lake Fault.
Metasedimentary terrains in the surrounding area of massive structures, once thought to have low mineral potential, have been the site of new gold discoveries like Newmont-Goldcorp’s Éléonore mine in northern Québec, the Valentine Lake gold deposit in Newfoundland, and the Curraghinalt gold deposit in Northern Ireland.
The Pakwash North Block previously comprised part of a large claim group called the Goldpines property that was investigated by Laurentian Goldfields Inc. in 2010 and 2011. This was the only prior exploration in the area, and work in this area of the Goldpines property was limited to lake-sediment geochemical surveying, geological mapping, and MMI soil sampling and analysis.
The mapping established the presence of the Sydney Lake Fault. There is a small quantity of MMI soil samples with anomalous gold next to the Sydney lake Fault in the eastern area of the property.
The accompanying map illustrates the Pakwash East and Pakwash North claim Blocks, Great Bear Resources Dixie and Pakwash properties, and also the Pakwash South property. The Dixie 17-18-19-20 and Dixie 3 (Snake Falls) claim Blocks, part of Pistol Bay’s Confederation Lake project, are also specified on the map.
Under the conditions of the option agreement, so as to purchase a 100% right, title, and interest in and to the property, Pistol Bay Mining will need to offer total cash payments of $45,000 and issue a total of 500,000 shares spread across a period of three years. 1544230 Ontario Inc. will keep a 1.5% net smelter returns royalty.
Pistol Bay Mining will retain the right at any time to acquire one-half (1/2) of the NSR Royalty, being three-quarters of 1% (0.75%), from 1544230 Ontario Inc. in consideration of the payment to 1544230 Ontario Inc. of $500,000, thus leaving Pistol Bay Mining with three-quarters of 1% (0.75%) NSR Royalty.