MTO will have plenty of Options....
...with price of gold staying up ...and the area heating up...and more big miners moving into Quebec friendly mining jurisdiction...MTO should do well ...Osk mining may end up having a harder time consolidating the area the longer they take... and as more big miners move in like as in the below article... good read of whats happening ....drill results and open pit mining should help garner more attention for the company...
Kinross expands its reach in the Abitibi
A map showing the Rouyn property in the context of the wider Abitibi region. Credit: Yorbeau Resources.Posted By: Trish SaywellOctober 25, 2016
The Cadillac-Larder Lake Break in Canada’s well-known Abitibi Greenstone Belt has produced more than 100 million ounces of gold from mines such as Lakeshore, Macassa, Kerr-Addison, Doyon, Bousquet, LaRonde, East-Malartic, Kiena and Sigma-Lamaque. Kinross Gold (TSX: K; NYSE: KGC) used to operate the Macassa mine in Kirkland Lake and is now jumping back into the district.
The gold major — with mines in the Americas (U.S., Brazil and Chile), West Africa and Russia — signed an agreement this week to acquire a 100% interest in Yorbeau Resources’ (TSX: YRB.A) Rouyn project, about 4 km south of Rouyn-Noranda, in southwestern Quebec.
The project contains three known gold deposits and a fourth mineralized zone that cover a 12-km stretch of the Cadillac-Larder Lake Break, the major fault zone that extends more than 250 km from west of Kirkland Lake in Ontario to east of Val d’or in Quebec.
“Kinross wants to get established. They want to get a good property, in Quebec, and for them the Cadillac Break is one of the better known structures and has a good record of production and discovery,” Grald Riverin, Yorbeau’s president, says in an interview.
“They like the 12-km strike length and the results we have had so far, and the fact that all of these prospects, all of these deposits, are open at depth, and that’s where they will start their drilling, extending the known deposits at depth and see if they can get the threshold they need to get a mine.”
Kinross is the second gold major to sign an option deal on the Rouyn project. Gold Fields (NYSE: GFI) inked an option deal of its own in 2012 but dropped it in June 2014 after investing about $4 million in drilling commitments and cash.
“With what we had drilled we were able to attract Gold Fields and they were quite keen to get going,” Riverin says, “but then their new CEO decided there was no Greenfield exploration for them worldwide, including Rouyn. It was a big disappointment, but sometimes that happens.”
Gold Fields’ loss is Kinross’ gain, Riverin believes, noting that there is lots of exploration upside on the property where the three three known deposits (Astoria, Augmitto and Gamble Lake) have been drilled to depths of around 700 metres and remain open. In addition to the deposits, the project also contains an interesting mineralized zone called Cinderella.
Riverin notes that the Rouyn project is about 40-50 km east of the Kerr-Addison mine, which produced about 11 million oz. gold. “Rouyn is exactly the same environment as Kerr-Addison,” he says, “it’s in ultramafic rocks and so on, and that’s the biggest mine closest to us.”
Louie Diaz, director of corporate communications at Kinross, wrote in an email to The Northern Miner that the company optioned the Rouyn property “for the exploration potential.”
“The property covers a prospective 12 km segment of the Cadillac-Larder Lake Break in the Abitibi Greenstone belt … [It] hosts at least three known gold deposits, all of which are open at depth. This deal is consistent with our strategy of maximizing exposure to promising Greenfield opportunities, in quality jurisdictions, through agreements with junior exploration companies.”
Under the option agreement, Kinross can earn an option to purchase 100% of the property if it spends $12 million dollars on exploration over four years, and completes a resource estimate. (Of the $12 million, $6 million must be spent on diamond drilling. And of that, $3 million must be spent in the first 18 months, including drilling no less than 12,500 metres. )
Once a resource is completed, Kinross has the option to acquire 100% of Rouyn for US$25 million in cash, plus 2% of the prevailing gold price multiplied by the number of ounces in measured, indicated and inferred resources outlined in the resource estimate.
In addition, Yorbeau retains a 2% net smelter return royalty (NSR) on any ounces produced at Rouyn in excess of the number of ounces Kinross identified in the resource estimate.
Yorbeau first gained a foothold in the area in 1984, when it acquired the Astoria property, and proceeded to conduct extensive surface and underground exploration there over the next decade.
With the help of early joint-venture partners (Les Mines Belmoral and Deak Resources), a 515-metre shaft was sunk and lateral workings were developed over a six-year period (1984-1990).
A total of 163,122 tonnes were mined at Astoria between 1986 and 1995, at a recovered grade averaging 5.32 grams gold per tonne. Mining was intermittent, however, and the operation was shut down due to low gold prices.
In January 2005, P&E Mining Consultants prepared a resource estimate for Astoria at a 3 gram gold per tonne cut-off grade, which showed an undiluted, open-pit measured and indicated resource of 770,000 tonnes grading 2.57 grams gold per tonne and an underground measured and indicated resource of 1.97 million tonnes grading 4.51 grams gold for a total of 349,100 ounces of gold.
Undiluted inferred resources amenable to open pit and underground mining at Astoria totaled 14,000 tonnes grading 2.29 grams gold and 385,000 tonnes grading 4.83 grams gold, respectively, for another 60,800 ounces of gold.
In 1997, Yorbeau acquired the Augmitto deposit, about 6 km from Astoria, where extensive surface diamond drilling in the 1980s led to underground development and pre-production work. The work included the development of a 1,142-metre exploration ramp, a 250-metre shaft, a ventilation raise, and extensive drifting on several levels.
A resource estimate for Augmitto completed by Roscoe Postle Associates in 2011 outlined a measured and indicated resource of 247,000 tonnes averaging 6.1 grams gold for 48,200 oz. contained gold, and inferred resources of 633,000 tonnes grading 7.8 grams gold for 159,000 oz. contained gold. The resource estimate used a cut-off grade of 3.4 grams gold per tonne. Since that resource was completed, drilling at Augmitto has returned intercepts such as 7 metres averaging 7.9 grams gold and 5.3 metres of 11.4 grams gold.
Yorbeau discovered two deposits of its own in 2008 and 2009 — Gamble Lake, about 1 km west of Astoria, and Cinderella, about 1.5 km west of Gamble Lake. Highlights from drilling at Gamble Lake have included an 11.3 metre intercept of 6 grams gold. At Cinderella notable intercepts include 13 metres of 5.4 grams gold and 9 metres of 6.6 grams gold.
Yorbeau’s Riverin says drills will be on the property before the end of the week and both Astoria and Gamble Lake will be drill tested “very shortly.” “They have already planned their drill program [and] the permitting has all been done,” he says.
“We’re happy and we hope they’re happy,” he says. “The property will finally get a chance to be explored.”
“I think it was important for Kinross to be in gold country,” he adds, “and the Cadillac Break certainly is in gold country.”