CMQ Resources Inc. (TSX-V: NV) has reported drill results for its Red Canyon sediment-hosted gold project in Eureka County, NV. In July and August 2010, Montezuma Mines Inc., a wholly owned subsidiary of CMQ, completed an eight hole, 11,260 ft (3,433 m) reverse-circulation drilling program at Red Canyon.
Montezuma's drilling attempted to expand upon results in MR09-05C, a 2009 core hole that intersected 119 ft of 0.152 oz Au/t (36.28 m of 5.25 g Au/t) at the Ice prospect. The drill program tested geologic, geochemical and geophysical targets southeast of MR09-05C in an area of complex faulting and folding.
Drill results included two mineralized zones in MR10-01, a vertical hole 1,660 ft (505 m) southeast of core hole MR09-05C. The intercepts include 20 ft of 0.050 oz Au/t from 775-795 ft (6.1 m of 1.731 g Au/t from 236.3 to 242.4 m) and 20 ft of 0.086 oz Au/t from 965-985 ft (6.1 m of 2.955 g Au/t from 294.2 to 300.3 m). Prior drill results by Montezuma and others confirm the presence of a 650 ft-wide (200 m), 2,850 ft-long (869 m), southeast-striking corridor that extends from Ice through MR10-01 and up to 1190 ft (363 m) to the southeast. The corridor between MR09-05C and MR10-01 has not been drilled by past operators.
The remaining seven drill holes, MR10-02 through MR10-08, did not intersect gold mineralization exceeding 0.01 oz Au/t (0.343 g Au/t).
All drill samples were collected with a reverse circulation drill using 5 ft (1.5 m) sample intervals. Samples were assayed by ALS USA Inc. of Sparks, Nevada. Gold results were determined using standard fire assay techniques on a 30 gram sample with an atomic absorption finish. Montezuma QC/QA included the insertion of standards and blanks on a regular basis, collection of duplicate samples, and rerun assays on select samples. Check assays were performed by SGS Mineral Services in Toronto, Ontario.
The Red Canyon project includes 254 unpatented lode mining claims (7.9 square miles/20.6 square kilometers) on the Battle Mountain-Eureka Trend and adjoins U.S. Gold's Tonkin Springs property to the west. The project covers an erosional "window" that exposes hydrothermally altered and brecciated lower-plate carbonate rocks that are age equivalent to the rocks hosting the Cortez Hills gold deposit.
Risk of Continued Operations
At CMQ's Annual and Special Meeting of Shareholders held January 19th, 2010, shareholders failed to approve the proposed Amended Funding Agreement, as further described in CMQ's Information Circular dated December 21, 2009 on a "majority of the minority" basis, as required by the TSX Venture Exchange and applicable securities regulations. As a result of the failure of this proposal, CMQ is in default under its existing funding agreement with Matco Capital Ltd. ("Matco") and does not have any source of capital to continue its operations. CMQ is currently indebted to Matco for approximately $2,350,000, including unpaid interest. Matco has the contractual right, as at the date hereof, to enforce its security over all of CMQ's assets, including all of CMQ's exploration properties. Presently, CMQ is attempting to negotiate a forbearance agreement with Matco and is exploring other financing alternatives as described in its September 1st, 2010 press release. There can be no assurances that any such forbearance agreement will be concluded. If a forbearance agreement is reached, the terms may be punitive to CMQ and its shareholders.
CMQ's directors have not made a filing under the Companies' Creditors Arrangement Act ("CCAA") because obtaining financing to fund a CCAA process is remote given the exploratory nature of CMQ business and the uncertain value of its assets.
CMQ currently has 6,534,670 Common Shares issued and outstanding.
John Hogg, CEO, CMQ Resources Inc., is the qualified person, as defined by National Instrument 43-101, who has reviewed and verified the data disclosed in this press release.
Source: CMQ Resources Inc.