Toronto, Ontario – June 28, 2018 – Orefinders Resources Inc. (“Orefinders” or the “Company”) (TSX.V: ORX) is pleased to announce that it has negotiated an agreement with the Province of Ontario’s Ministry of Northern Development and Mines to resolve a series of Directors Orders and other outstanding issues that have effectively impeded investment on the McGarry Mine & Barber Larder properties. Accordingly, Orefinders has now waived a condition precedent to completing its acquisition of these properties and will now move to close the acquisition in the near term.
“This a big win for our shareholders. The price we paid for McGarry/Barber-Larder reflected an asset which had been tied up in controversy, litigation and environmental issues. This new understanding with the Province eliminates such issues and creates a clear path forward for Orefinders to develop this project. Having resolved this issue, we will now own a valuable asset encompassing 3.0km of prime Cadillac-Larder Lake Break real estate, a high-grade resource with significant upside, all of which sits between the historic world-class Kerr-Addison Mine and Bonterra’s Larder Lake assets. This agreement opens up the region and we see McGarry and its neighbours having a bright future,” said Stephen Stewart, Orefinders’ Chief Executive Officer.
Over the past 12 months, Orefinders has completed substantial due diligence to evaluate and devise a strategy to ultimately de-risk this project. The region’s environmental issues largely stemmed from the lack of a progressive rehabilitation plan for the tailings facility for the Kerr Addison Mine, which has historically produced over 11 million ounces of gold during a 56-year period. With the new progressive rehabilitation plan in place and the Province’s Directors Orders now being rescinded, Orefinders sees this as the inflection point for investment flowing into the McGarry, and surrounding Larder Lake district, which has a long and well understood history of high grade gold mineralization and production.
Orefinders now owns a large and self-contained tailings facility In addition to the existing resources and exploration upside at the McGarry Mine & Barber-Larder property, Orefinders will now also own a large and self-contained tailings facility. Owning such a facility could serve as a significant advantage to the Company as it develops the McGarry & Barber-Larder and its other proximate assets including the Mirado Mine and Knight Projects.
Tailings facilities are the most complex and time-consuming element with respect to permitting any mill or processing facility, thus ownership of this brownfield facility could prove advantageous as Orefinders moves its development plans ahead.
McGarry & Barber-Larder Are Positioned Between Two Highly Prospective Assets Orefinders McGarry Mine & Barber-Larder properties are contiguous with--and directly between—two high profile and prospective properties. To the east is one of Canada’s largest past producing mines, the Kerr-Addison Mine, and to the west is Bonterra Resources’ Larder Lake properties. Of recent note is the proposed merger of Bonterra and Metanor Resources’ who announced that as a part of the merger, their Larder Lake assets would be spun-out into a new company with $7 million cash in its treasury. See Figure 1 for area map.
About McGarry Mine & Barber-Larder The McGarry Mine & Barber-Larder property is in Virginiatown, Ontario within the Abitibi Greenstone Belt and spans 3.0km on one of the world’s most prolific gold structures, the Cadillac Larder-Lake Break. The property encompasses 681 hectares and is comprised of 46 Patented Mining Claims and 5 Mining Licenses of Occupation.
McGarry hosts a NI43-101 indicated resource of 123,000 oz at an average grade of 7.7g/t gold (uncut or 112,000 ounces with grades top-cut to 51.4 gpt), and an additional inferred resource of 30,000 oz. at an average grade of 5.3 g/t (uncut or 29,000 ounces with grades top-cut to 51.4 gpt) as per McGarry resource estimate from 2009 (see cautionary below). McGarry also has a NI 43-101 Preliminary Economic Assessment, published in 2011, which is based off McGarry’s 2009 resource estimate.
McGarry is located east of and immediately adjacent to the Kerr-Addison Mine, which was one of Canada largest gold mines producing over 11,000,000 ounces gold over a 58-year period ending in 1996 (Figure 1) (see MNDM OFR5831). Adjacent to the west of McGarry is Bonterra Resources’ Cheminis Mine and Bear Lake deposits which host a historic estimate (2011, P+E Mining) of 3,750,000 tonnes at 5.7 g/t (683,000 oz) (inferred) and the Cheminis Deposit contains a historic resource estimate (2011, P+E Mining) of 335,000 tonnes of indicated resources at 4.1 g/t (43,800 oz) and 1,391,000 tonnes of inferred resources at 5.2 g/t (233,400 oz). Bonterra’s Technical Reports are available at www.sedar.ca.
On site infrastructure includes a head frame, shaft compartments, hoist, offices, and fully functional core shack all refurbished over the last ten years. McGarry is easily accessible with the Trans-Canada Highway running directly through the property.
McGarry Production and Infrastructure As recently as 2013 the McGarry Mine was in production from significant underground workings and was undergoing underground exploration. Kerr/Armistice spent considerable capital upgrading the McGarry’s infrastructure including the shaft, hoist and onsite facilities necessary to extract ore from underground. Additionally, extensive underground exploration yielded outstanding grades over very long drift lengths, including:
325 N Zone – 2280 sublevel - 8.2g/t gold over 98m length and 1.5m width, Stope #1 (E & W)
- 4.6 g/t gold over 26m length and 1.3m width, Stope #1.5 (E & W)
- 7.6 g/t gold over 79.2m length and 1.4m width, Stope #2 (E & W)
325 N Zone – 2330 sublevel - 11.1 g/t gold over 24m length and 1.7m width, Stope #1 (E)
- 6.1 g/t gold over 7.6m length and 1.2m width, Stope #2 (E)
- 4.3 g/t gold over 7.6m length and 1.8m width, Stope #2 (W)
440 N Zone – 2250 level - 6.2 g/t gold over 18m length and 1.6m width
The above exploration results and grades include 35% dilution and are reported from Kerr Mines news release April 22, 2013 which is available on Sedar.com.
McGarry Historical Mineral Resources
| Table 1: McGarry Historical Mineral Resource Estimate, Armistice Resources 2011 Technical Report |
The McGarry Property was the subject of a PEA study in 2011 that outlined a historical mineral resource of 447,000 tonnes grading 7.89 gpt gold for a total of 112,000 gold ounces in the Indicated Category and an additional 157,000 tonnes grading 5.83 gpt gold for a total of 29,000 ounces in the Inferred Category (Table 1 below). This estimate was based on a 3.43 gpt Au lower cut-off with assay grades limited to 51.4 gpt gold. A specific gravity of 2.79 grams per cubic metres was used along with a minimum horizontal mining width of 1.5 metres. The report is available at
www.sedar.ca under Kerr Mines Inc. and its amended version was published on 30 September 2011.