Mr. James Jacuta reports
NANIKA ANNOUNCES POLARIS GOLD PROPERTY ACQUISITION
Nanika Resources Inc. has entered into an agreement to acquire by option the Polaris gold property, which is located five kilometres northeast of Aiken Lake, approximately 250 kilometres north of Fort St. James in British Columbia. The property claims are road accessible in a recently clear-cut area and comprises more than 800 hectares of land.
The property is centred on Polaris Creek and covers a belt of volcanic and sedimentary rocks that was prospected by the Consolidated Mining and Smelting Co. (CM&S or Cominco, now Teck Corp.) in the 1930s. Cominco found the Discovery zone, an area of quartz-carbonate veining in argillite measuring 35 by six metres, carrying pyrite, arsenopyrite, pyrrhotite, galena, sphalerite, chalcopyrite and minute particles of free gold.
Grab samples taken by Cominco from the veins yielded assays of up to 1,015 grams per tonne gold, with 36 samples of vein material averaging 62.37 grams per tonne gold, with the entire zone estimated to carry 3.2 grams per tonne gold.
Shallow till covers much of the property. However, significant showings of gold, copper, a pyrrhotite-rich massive sulphide and silver-lead-zinc were discovered on Polaris and Jupiter creeks. The Polaris gold property was one of the most important exploration targets for Cominco in the late 1930s. Prospecting outlined three significant gold showings on the property, with 500 metres of underground development on the Jupiter Creek showings. Along strike from the Discovery zone to the southeast, more recent work has documented highly anomalous soil samples on the property (to 616 parts per million copper, 2.0 ppm silver and 344 parts per billion gold) with an associated zone of EM conductivity.
At the Polaris zone which is on the property, approximately 475 metres south of the Discovery zone, an adit with several branches was driven a total of 45 metres to intersect quartz vein mineralization cutting porphyritic diorite found in talus. The adit reportedly stopped short of the target. However, Cominco assays of the talus material returned assays of between 6.9 and 415 grams per tonne gold. One hundred metres north of the Discovery zone, Cominco trenched a base metal occurrence on the property called the Nanny zone, where a 20- to 100-centimetre-thick zone containing chalcopyrite, pyrite and pyrrhotite yielded assays of 3.56 per cent Cu, 2.1 grams per tonne gold and 20.0 grams per tonne silver across 0.6 metre. Also on the property in the Polaris Creek area, a strongly (silicified and carbonatized) altered contact area between mafic volcanic and clastic sedimentary rocks have been traced by airborne and ground geophysical surveys. Showings of massive sulphide (pyrrhotite-pyrite) nine metres in thickness are exposed. On the property at Jupiter Creek more than 300 metres of drifting and 200 metres of crosscutting are completed on several gold and silver-base metal showings. The main structure, the No. 2 vein, is a shear-zone structure composed of carbonate-altered pyritic graphytic rock with some green mica (mariposite) alteration. The showing has many aspects similar to greenstone-type or orogenic-type gold deposits. Based on historical assay plans, Dr. Nick Carter, PEng, estimated the main drift exposed a mineralized zone of 1.3 metres wide assaying an average of 6.34 grams per tonne gold and 42.5 grams per tonne silver for a length of 24.4 metres. Cross structures host classical vein-type silver-rich galena and sphalerite mineralization in quartz-carbonate fissure veins.
Surprisingly, despite these highly encouraging results, the property has never been drill tested -- no physical work has been undertaken on the property since the Cominco work in the 1930s. Nanika has not yet undertaken any independent investigation of the Polaris gold property nor has it independently analyzed the results of previous exploration. Therefore the historical sampling referred to above should not be relied upon. It must also be noted that at this time there is no certainty that mineralization with the above reported grades will be found by Nanika on these claims. However, the company believes that these historical results are relevant to continuing exploration.
Nanika can earn a 100-per-cent interest in the Polaris gold property by paying $1-million by the following payments:
- $10,000 on execution of the agreement;
- Pay the optionors $20,000 on or before the first anniversary date;
- Pay the optionors $20,000 on or before the second anniversary date;
- Anniversary, year 3: $20,000;
- Anniversary, year 4: $30,000;
- Anniversary, year 5: $100,000;
- Anniversary, year 6: $100,000;
- Anniversary, year 7: $100,000;
- Anniversary, year 8: $100,000;
- Anniversary, year 9: $200,000;
- Anniversary, year 10: $300,000.
There is a 2-per-cent net smelter return held by the optionors. The optionee shall have the right to purchase one-quarter of the net smelter return royalty for $1-million and a second quarter for $4-milllion. An initial payment of $10,000 will be made upon execution of the agreement.
The agreement is made subject to acceptance by the TSX Venture Exchange. The property is being acquired from a private individual representing a group that included a minority interest held by company director R. H. McMillan. Mr. McMillan declared his interest to the board of directors in advance of the acquisition and abstained from taking part in the decision to acquire the property. Mr. McMillan is a qualified person under National Instrument 43-101 and will supervise the project and has reviewed and approved the technical disclosure in this news release.