Avarone Metals Inc. has entered into an agreement with an arm's-length vendor to acquire a 100-per-cent interest in the McWilliams Lake gold project, which covers an area of about 1,009 hectares, 6.4 kilometres northwest of Avarone's Wildnest gold project in central Saskatchewan, near the Manitoba border. The claims adjoin exploration projects controlled by Hudbay and Murgor Resources Inc. to the south. Under the terms of the agreement, Avarone can earn a 100-per-cent interest by issuing four million common shares and incurring $1-million in exploration expenditures over the next four years. This transaction is subject to TSX Venture Exchange approval.
In 2008, Murgor Resources completed VTEM survey of the McWilliams Lake project (as part of the Flin-D project) and 30-hertz electromagnetic data were subsequently interpreted by Condor Consulting Inc. (Dr. Daniel Sattel, PhD geophysics, and Ken Witherly, AIPG). The 2,063-line survey was performed with 200-metre line spacing and with an average EM bird height of 40 m. The magnetometer was mounted in a separate bird flown at an average height of 62 m above ground. The principal task of the survey was to identify targets which could be zones of polymetallic volcanogenic massive sulphide-style mineralization analogous to the Flin Flon or Triple 7 deposits. The expected geophysical target based on knowledge of the local deposits in the Flin Flon district (the Fon and Abbott Lake deposits) would be features of moderate to strong conductance with possible magnetic association. Based on local examples, zones of economic mineralization may also be found as discrete zones or as part of longer, formational-style trends. The Condor interpretation identified two broad anomalies, both of which were potentially formational in nature and of high priority. The largest anomaly is northeast trending and covers an area of over three km. These anomalies are significant as gold-bearing mineralization in this area are closely associated with graphite and as such are conductive.
Regarding the acquisition, Marc Levy, president of Avarone, commented: "With this acquisition, the company has expanded its Wildnest land position and added multiple areas of exploration in this highly prospective corridor, and now controls about 8,100 hectares. We look forward to advancing this project in the near term and increasing shareholder value."
The company is currently designing an aggressive drill program to confirm and expand known mineralization at Wildnest. Evaluation of preliminary drilling by Hudson Bay and Mingold Resources in the mid-1980s defined a reserve of 660,000 tons grading 0.10 ounce/ton gold to a depth of 400 feet (downdip), this being equivalent to roughly 66,000 ounces Au, with the best drill hole grading 0.619 ounce/ton Au over 21 feet (285 to 306 feet), including an interval grading 1.36 ounces/ton Au over 10 feet.
Peter Born, PGeo, the company's qualified person, has neither reviewed the original Wildnest drilling data or reserve calculations. The reserves reported herein are not National Instrument 43-101 compliant, and although the reserves were prepared by what is assumed to be reputable professionals, they cannot be relied upon. These estimates are only relevant in assessing the potential type and dimension of a deposit that could exist, and which must be confirmed through drilling and subsequent estimates by the company. Geological and exploration information contained in this release is derived from sources believed to be credible.
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