Modern resource reporting techniques will likely enhance the value of the recently acquired Glover Island property in Western Newfoundland, said Gary Woods, president and CEO of Halifax-based Mountain Lake Resources Inc.
Woods said in an interview Friday previous gold assessments at the site demonstrated the existence of the resource.
"We’re not going in there looking for gold, we’re going in there to drill holes to confirm previous assessments," he said.
Existing data about Glover Island was compiled prior to the introduction of stricter standards for mineral resource reporting, said the president.
Mountain Lake announced Friday it was acquiring 100 per cent of the Glover Island gold property from New Island Resources Inc.
Mountain Lake wanted to take over New Island Resources but lost out to a competing bid from Anaconda Mining Inc. "We did not get the company but we did get land that has phenomenal exploration potential," said Woods.
The Glover Island property includes two mineral leases and one mining lease and covers a total of 5,100 hectares.
It is situated about 70 kilometres from Mountain Lake’s Valentine Lake gold project.
"We expect a major push at Glover Island in the spring," said Woods.
When drilling starts, the objective will to be to obtain data that is compliant with the mineral resource reporting standard.
"There were about eight holes drilled at the location in 2003 and about 70 holes were drilled back in the early 1990s, but this was before the new reporting standard came into effect. We’ll be going in with more sophisticated instruments and technology and reporting techniques," said Woods.
Mountain Lake will pay New Island $500,000 and plans to issue $1 million in common shares. The deal requires regulatory approval.
( bpower@herald.ca)
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