TORONTO, Jan. 26, 2012 /CNW/ - Further to its press release dated
December 15, 2011, Merc International Minerals Inc. ("Merc") is
pleased to announce that it has completed the acquisition of a 100%
interest in the mineral claims and leases (the "Colomac Property"),
including those of the former producing Colomac Gold Mine in the
Northwest Territories ("NWT") from Aboriginal Affairs and Northern
Development Canada ("AANDC"). Highlights: -- Includes the past
producing Colomac Gold Mine, four surrounding gold deposits, and
several gold showings; -- Historical, non-NI 43-101 compliant gold
resource ranging from approximately 750 thousand to 1.1 million
ounces of gold ("oz Au") (See Table 1 for further details; cut-off
grades are unknown); -- A NI 43-101 technical report and mineral
resource estimate for the Colomac Property, is currently being
completed by ACA Howe International Ltd. and is expected to be
finalized in the first quarter of 2012; and -- Historic drilling at
the Colomac Gold Mine from 1997 indicates the presence of a
high-grade gold shoot to a depth of over 1,000 metres and an
extension of mineralization beneath the pit to a vertical depth of
700 metres. David Wiley, Merc President and CEO, remarked, "We are
excited to have completed the Colomac acquisition and that Merc now
controls over 90% of the Indin Lake Gold Camp. We are encouraged by
the historic resource estimates, which we discovered during the due
diligence process for the acquisition, and believe we have made an
attractive acquisition. We will be working on a NI 43-101 compliant
resource estimate in the near future, and we expect the winter 2012
drill program to commence in March. Now that we have closed the
transaction, our objective will be to expand known zones of
mineralization to depth and along strike, and begin remediating the
historic reclamation sites." Acquisition Terms In consideration for
the conveyance of the Colomac Property, Merc will commit to reclaim
three disturbed historic exploration sites not associated with the
Colomac Property. Reclamation will be carried out on behalf of
AANDC to a maximum of $5,000,000. Merc will not be assuming the
reclamation liabilities directly. Merc is not responsible for any
historical environmental liabilities associated with Colomac.
Colomac Opportunity The Colomac Property represents a rare
opportunity as a past producer and under-developed gold deposit
with exploration potential. Merc believes there is an opportunity
to develop resources at the Colomac Property (as historic open pit
mining was limited to less than 200 metre vertical depths and only
one of five known deposits was developed). All deposits at Colomac
remain open to depth and laterally. The Main Deposit on the Colomac
Property was not mined out when production ceased in 1997.
Perennial low gold prices and operational difficulties ultimately
lead to the termination of mining at the Colomac Property. Merc
believes a resource remains that has the potential to be expanded
by drilling known mineralization to depth and along strike, as well
as by exploring for high-grade plunging gold shoots that are known
to exist, plunging over 1,000 metres to depth. Table 1 below
summarizes historical, non-NI 43-101 compliant resource estimates
sourced from public documents and internal company reports; these
estimates should not be relied upon. Merc has not independently
verified these numbers nor does it propose that they should, in any
manner, be viewed as a current mineral resource or mineral
reserve. A Qualified Person as defined in NI 43-1010 has not
done sufficient work to classify the historical estimate as current
mineral resources or mineral reserves. These historical
numbers are presented in support of the position that the deposits
were not mined out, and as such, opportunities exist to build upon
what may have been left. Merc is not treating the historical
estimates as current mineral resources or mineral reserves. Table
1. Colomac Historic, Non-NI 43-101 Compliant Resource Estimates
Year Source Short Tons Grade Oz Au Subsequent Net Oz Au of Ore
(oz/ton) Resource Oz Au Mined Resource Estimate Estimate2 1988
Energy, 27,000,000 0.060 1,680,000 527,908 1,152,098 Mines and
Resources Canada, Mineral Bulletin, 223 1990 The Northern
28,100,000 0.056 1,573,600 527,908 1,045,692 Miner 19951 Royal Oak
16,692,000 0.052 860,400 108,678 751,722 Mines Inc. (1)Estimates
are based on a Royal Oak Mines Inc. ("Royal Oak") report written in
1995 that projected the ore reserve as at December 31, 1996.
Subsequently, Royal Oak mined 108,678 oz Au in 1997. (2) Merc has
not independently verified these numbers nor does it propose that
they should, in any manner, be viewed as a current mineral resource
or mineral reserve. No information is available for the cut-off
grades used to calculate these estimates. Royal Oak 1997 Drilling
at Colomac During its last year of operation at Colomac, 1997,
Royal Oak drilled 21 holes following up on a near surface
intersection of 1.08 ounces per ton gold over 4 metres in Zone 3.5.
Drilling pursued a higher grade mineralized shoot plunging 70
degrees to a depth of 1,000 metres. This represented the first
discovery and definition of a high-grade mineralized feature within
the host Colomac Dyke. The presence of recently discovered
high-grade shoots significantly increases the exploration potential
of the dyke. Merc intends to aggressively pursue these plunging
shoots in its upcoming drill program. In 1997 Royal Oak also tested
the dyke below Zone 2.0, the zone that accounted for the majority
of production at Colomac. A single hole was drilled below the Zone
2.0 pit 2,000 metres north of Zone 3.5, and it intersected the dyke
500 metres below the bottom of the pit (reporting a 120 metres
intersection of 1.30 grams per tonne gold). The 1997 deep drilling
has confirmed that the Colomac Dyke continues uninterrupted to
depth, the dyke maintains significant mineralized widths, the grade
of mineralization appears consistent, and a high-grade gold shoot
exists within the dyke and represents one of the most exciting
target opportunities yet to be explored. Given its robustly
mineralized characteristic, Merc believes that Colomac continues to
represent an under-explored opportunity with the potential to
develop and expand resources throughout the five known deposits.
About The Colomac Property The Colomac Property lies within the
central portion of Merc's 94,701 hectare Indin Lake property, 220
kilometres northwest of Yellowknife, NWT. Access is by winter road
from Yellowknife or year round by chartered aircraft to a 5,000
foot airstrip at the former Colomac Gold Mine site. With this
acquisition Merc has secured a contiguous land position fully
surrounding the Colomac Property, and consolidated greater than 90%
of the Indin Lake Greenstone Belt including the related Indin Lake
Gold camp. The Colomac Property contains at least five separate
gold deposits open in all dimensions (Colomac Main, Grizzly Bear,
Goldcrest, Dyke Lake, and 24/27), only one of which, the Colomac
Main Deposit, was historically mined. Intermittent mining from 1990
to1997 was limited to three shallow open pits developed on a
steeply dipping quartz-feldspar porphyry intrusion (Colomac Dyke).
Historical production is reported to be 527,908 ounces of gold with
an average head grade of 1.66 grams per tonne (see Table 2). Mining
activities impacted only a small portion of the dyke's 7 kilometre
mineralized strike length. Table 2. Colomac Production History Year
Ounces Tonnes Head Recovery Cash Average Produced Milled Grade
Cost/oz Gold (g/tonne) (US$) Price (US$) 1990 64,500 1,040,000 1.89
90% 300 384 1991 74,100 1,131,000 2.19 94% NA 362 1994 40,568
985,091 1.58 87% NA 384 1995 117,646 2,725,388 1.61 92% 383 384
1996 122,416 3,013,156 1.58 87% 370 388 1997 108,678 2,906,081 1.51
85% 354 331 Total: 527,908 11,800,716 1.66 89% General Geology
Colomac lies within a north striking, steeply dipping, Archean
greenstone belt of deformed sedimentary and intermediate to
ultramafic volcanic rocks. Deposits appear in two distinct
geological settings with the Colomac Main, Goldcrest, and Dyke Lake
deposits hosted within quartz-feldspar porphyry dykes, whereas the
Grizzly Bear and 24/27 deposits occur near or within the
sedimentary/volcanic rock contact. Colomac Main Deposit The Colomac
Main Deposit occurs within a north-south striking, quartz-feldspar
porphyry dike approximately 7 kilometres long and 50 metres wide
bounded by diorite and andesite. Mineralization is predominantly
free gold spatially associated with quartz-carbonate veining and
minor sulphides. During deformation, the dyke behaved as a
competent unit enclosed within more ductile rocks, thus
representing the classic competency contrast condition present in
many Archean lode gold camps. This has led to the preferential
emplacement of gold-bearing veins within the quartz-feldspar dyke.
Grizzly Bear Lake and 24/27 Deposits These three deposits are
typical of many gold deposits within the Indin lake Greenstone
Belt. Like the Treasure Island and North Inca-Diversified deposits,
the Grizzly Bear Lake and the 24/27 deposits are located at a fault
related volcanic rock sedimentary rock contact exhibiting
considerable shearing. Gold mineralization is characterized by
quartz stringers associated with silicification and carbonatization
within volcanic rocks adjacent to the steeply dipping north-south
volcanic/sedimentary rock contact. About Merc International
Minerals Inc. Merc is a Canadian-based exploration company focused
on acquiring and developing gold mineral properties in the NWT. Its
primary land position covers 234,013 acres or 94,701 hectares in
the Indin Lake Gold Camp, located approximately 220 kilometres
north of Yellowknife, NWT. The technical information in this news
release was reviewed and approved by Merc Director, Dr. Michael J.
Byron, a Qualified Person under NI 43-101. Historical information
was obtained from previous Royal Oak Reports, The Northern Miner,
and Northwest Territories Geoscience Office. Neither TSX Venture
Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements Certain information set forth in this
news release may contain forward-looking statements that involve
substantial known and unknown risks and uncertainties, including,
but not limited to, the timing of future drilling, the expansion of
the mineralization, the remediation of historic reclamation sites,
the completion of a NI 43-101 compliant resource. These
forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond the control of Merc,
including, but not limited to, the impact of general economic
conditions, industry conditions, volatility of commodity prices,
risks associated with the uncertainty of exploration results and
estimates, currency fluctuations, dependency upon regulatory
approvals, the uncertainty of obtaining additional financing and
exploration risk. Readers are cautioned that the assumptions used
in the preparation of such information, although considered
reasonable at the time of preparation, may prove to be imprecise
and, as such, undue reliance should not be placed on
forward-looking statements. This press release is not, and is not
to be construed in any way as, an offer to buy or sell securities
in the United States. Merc International Minerals
Inc. CONTACT: David Wiley, President and CEO Daniel Boase, Investor
RelationsMerc International Minerals Inc. First Canadian Capital
Corp.(647) 260-1247 (416) 742-5600 ext 232 (416) 363-4567 (FAX)
email: dboase@firstcanadiancapital.comEmail:
dwiley@mercinternational.ca
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