TSX.V Symbol: ELT
VANCOUVER, Dec. 1, 2014 /CNW/ - Electra Gold Ltd.
("Electra" or the "Company") (TSX.V: ELT) and its principle
shareholder Zimtu Capital Corp. ("Zimtu") (TSX.V: ZC) are
pleased to announce that they have formed a Strategic Alliance (the
"Alliance") with MGX Minerals Inc. ("MGX") (CSE: XMG) for
the purposes of jointly developing industrial mineral properties,
as follows:
- MGX acquires 2,000,000 million shares of Electra
- Electra acquires 666,667 shares of MGX
- Zimtu acquires 333,333 shares of MGX at a price of $0.25 for gross proceeds of $83,333 as part of the Company's non-brokered
private placement (see press release dated October 30, 2014)
- MGX engages Zimtu for capital market consulting services
- MGX will provide technical services to Electra
- Electra will provide industrial mineral sales and marketing
services to MGX
"This Alliance creates a number of specific opportunities for
growth and development within the industrial minerals sector in the
Province of British Columbia. We
look to expand and continue our model of acquiring and developing
assets that are anticipated to be in production within a relatively
short timeframe such as the Longworth Silica Property. We look
forward to advancing this project and other low impact, low capex
projects together with MGX," stated Electra President John Costigan.
Longworth Silica Property
As part of the formation of the Alliance, Electra has entered
into a Joint-Venture Agreement (the "Joint-Venture") under which
MGX will earn 50% undivided interest in Electra's wholly owned
Longworth Silica Property ("Longworth" or the "Property"), by
meeting the following work commitments:
- Incurring $100,000 in exploration
expenditures on the Property within twelve (12) months- including
eight (8) diamond drill holes; and
- Completion of a National Instrument (N.I.) 43-101 compliant
mineral resource estimate within eighteen (18) months.
The Property is located approximately 85 kilometers east of
Prince George in east-central
British Columbia and is accessible
by logging roads. The land package covers 1,084 contiguous hectares
situated four kilometers from the Canadian National railroad
mainline and power grid. The Property is listed as one of the top
silica occurrences in the Province of British Columbia by the BCGS (Simandl,
2014).
The Longworth claims were formerly held by Silver Standard
Resources Inc. ("Silver Standard"), who completed detailed
metallurgical work on the contained silica mineralization. Internal
reports suggested positive results as a potential feed source for
silicon metal smelting (Quartermain 1986).
According to B.C. Ministry of Energy and Mines Open File
1987-15, in reference to the Longworth Property: "At least four
northwest trending bands of quartzite have been mapped along the
western flank of a ridge. Thicknesses reach up to about 400 metres
over a discontinuous strike length of 10km. The main quartzite band
outlines a synformal structure open to the northwest. Rare bedding
observed in outcrop dips 70 to 80 degrees east. The quartzite is
very pure, massive and homogeneous. It is composed of extremely
well-rounded and well- sorted quartz grains, averaging 0.5
millimeter in diameter, which are cemented by silica. The quartzite
is pinkish white to buff on fresh surfaces and weathers grey to
white. Impurities include muscovite in cavities, limonite on
microfractures, minor calcite and possible hydrocarbons. Eight chip
samples collected in 1982 by the Geological Survey Branch averaged
99.5 per cent silica".
Of the 42 samples collected and analyzed by Silver Standard, 28
met the required chemical specifications with silica dioxide (SiO2)
levels ranging between 98.84 and 99.80 percent. Twelve of the 16
samples also boasted acceptable thermal shock results.
Longworth Property Development Plans
MGX has begun technical evaluation of the property and, as
necessary, will complete a N.I. 43-101 compliant technical report,
prepare an exploration and preliminary development plan and file a
Notice of Work with the B.C. Ministry of Energy and Mines to
complete diamond core drilling.
Initial exploration will focus on the Snow Claim, where sampling
of outcrop has shown consistent high grade (~99%) SiO2 over an area
spanning approximately 400 meters in length and width. (Assessment
Report 14815).
Development plans will be designed by the MGX's Qualified Person
and Vice President of Exploration Andris
Kikauka (P. Geo). Specific items in the technical evaluation
now underway by MGX include access trail, drill hole location and
topographical analyses for haulage road and quarry design.
High Purity Silica
The global silica market is projected to be 280 million tonnes
annually, valued at $9.2 billion, by
2016 (Freedonia Group 2014). The market can be divided into
low and high purity markets. There are a limited number of high
purity silica operations in western North
America and limited sources globally.
High purity silica is prized by the silicon industry that uses
it in the production of silicon metal. Silicon-based materials,
including silicones, can be formulated to deliver a wide range of
products from more durable construction materials; faster, smarter
electronic devices; to more efficient solar panels and wind
turbines. They are also used in healthcare and cosmetic
products.
High purity silica can also be used to make ferrosilicon a
valuable industrial mineral. MGX, operator of the Driftwood
Magnesite property, has indicated to Electra that it has a specific
interest in the production of ferrosilicon as it, along with
magnesium oxide, may be used as primary inputs in the production of
magnesium metal, a long term goal of MGX.
Frac Sand Market
The Company also has immediate plans to investigate the
potential to provide high-grade silica to the oil and natural gas
proppant markets, which represents one of the largest and fastest
growing industrial mineral markets in Canada and the
United States. Domestic annual consumption in the United States was estimated at 48 million
tonnes in 2013 (USGS, 2014), of which more than two-thirds was used
for hydraulic fracturing.
The Company will determine whether the silica mineralization at
Longworth meets the rigorous specifications to supply the frac sand
market. According to B.C. MINFILE 093H 083: "The quartzite is
very pure, massive and homogeneous. It is composed of extremely
well-rounded and well- sorted quartz grains." The Company plans
to submit samples taken by Electra during their summer 2014
exploration program for initial analyses.
About Electra Gold
Electra Gold Ltd.(TSX-V:ELT) operates the Apple Bay geyserite
quarry near Port Hardy, BC.
The quarry has operated continuously since 2003. Electra
ships by barge from its quarry on North Vancouver Island to the
Ashcroft Cement Plant in Seattle,
WA. Electra holds a portfolio of industrial and precious
metals properties. For more information please visit Electra's
website at www.electragoldltd.com.
About MGX Minerals
MGX Minerals (CSE: XMG) is a diversified Canadian mining company
engaged in the acquisition and development of industrial mineral
deposits in western Canada that
offer near-term production potential, minimal barriers to entry and
low initial capital expenditures. For more information please visit
the Company's website at www.mgxminerals.com.
About Zimtu Capital
Zimtu Capital Corp. (TSX-V: ZC) is a public investment issuer
that invests in, creates and grows natural resource companies
thereby providing a way for shareholders to indirectly participate
and profit in the public company building process. The Company also
provides mineral property project generation and advisory services
helping to connect companies to properties of interest. For more
information please visit Zimtu's website at www.zimtu.com.
On behalf of the Board of Directors
"John Costigan"
President and Director
Forward-Looking Statements
This press release contains forward-looking information or
forward-looking statements (collectively "forward-looking
information") within the meaning of applicable securities laws.
Forward-looking information is typically identified by words such
as: "believe", "expect", "anticipate", "intend", "estimate",
"postulate" and similar expressions, or are those, which, by their
nature, refer to future events. The Company cautions investors that
any forward-looking information provided by the Company is not a
guarantee of future results or performance, and that actual results
may differ materially from those in forward-looking information as
a result of various factors. The reader is referred to the
Company's public filings for a more complete discussion of such
risk factors and their potential effects which may be accessed
through the Company's profile on SEDAR at
www.sedar.com.
SOURCE Electra Gold Ltd.