Canstar Resources Inc. (Canstar) is pleased to announce it has entered into an option agreement to acquire several properties in the Kenora, Ontario area, collectively called the Kenora Gold Project.
The Kenora Gold Project represents four separate properties made up of 19 mining claim blocks comprised of 182 units for an area of 7,280 hectares. The properties are situated in the Wabigoon sub-province, and located approximately 20 km east of the Town of Kenora.
The Kenora Gold Project represents an area of historic mining during the 19th and early 20th century, and has seen little exploration since that time. During its time of production, the area accounted for 55% of gold production in Ontario. Geologically the properties occur near the boundary of the English River and Wabigoon subprovinces. Gold occurrences on the Project are typically high-grade and associated with regionally extensive shear zones, as well as dilational breccias. Recent prospecting in the area has returned grab samples of up to 16 g/t gold, with gold shown to occur over a 140 meter strike length. Historic production in the area reports gold values ranging from 56 g/t to 186 g/t. Very little modern exploration has been conducted on the project and Management feels there is strong potential for the area to host numerous, significant deposits. Many of the reported occurrences occur along the same structure, demonstrating potential mineralization over several kilometers, much of which has seen no modern exploration.
Danniel Oosterman, Canstar's President and CEO, states, "While the Mary March Project remains our flagship property, the Kenora Gold Project is a great opportunity in a much overlooked area in Northwestern Ontario. By acquiring this project, we are rounding out our portfolio by adding a precious metals asset to our existing core at a low cost that reflects the current market conditions, yet has outstanding exploration potential."
Canstar has a right to earn 100% of the Kenora Project by making cash payments totalling $18,200 over a two year term, and issuing 200,000 common shares upon the second anniversary. The Optionors will maintain a 3% net smelter royalty ('NSR'), subject to a buy-back right of $1,000,000 for the first 1.5% and $3,000,000 for the remaining 1.5%, which would reduce the NSR to 0%. The agreement is subject to regulatory approval.
Mr. Danniel Oosterman, P.Geo., the President and CEO of the Company, is a "Qualified Person" under National Instrument 43-101 and has reviewed the technical disclosure in this press release.
On behalf of myself and the Board of Directors,
Danniel J. Oosterman, P.Geo, President & CEO
Source: http://www.canstarresources.com/