Pangea boosts stake in Musselwhite play

Toronto-listed Pangea Goldfields has opted to convert its option to earn an 80% interest in the Karl Zeemel gold property near Pickle Lake, Ont., into a full 100% interest.

The property consists of 154 claims which cover the southeastern extension of the same banded iron formation that hosts Placer Dome’s (TSE) Musselwhite gold deposit.

Under the original agreement, Pangea could earn an 80% interest by spending $2.4 million on exploration and paying $300,000. Now, to earn 100%, Pangea must issue 100,000 common shares and 100,000 purchase warrants. The warrants entitle the holder to buy 100,000 Pangea shares at $3.75 each, until Oct. 26, 1995.

The new transaction also includes the purchase of an outstanding 3% net smelter return royalty on the property.

Previous operators completed about 17,000 ft. of shallow drilling, yielding a resource of 364,000 tons grading 0.134 oz. gold per ton to a depth of 200 ft. The deposit is open at depth and a drill program will be initiated next winter to test the down-plunge extension of the mineralization. Gold values have been outlined over a strike length of 2,700 ft., with intersections ranging from 4.5 to 40 ft. The mineralization is associated with pyrrhotite within a folded and sheared iron formation.

Pangea also holds a 100% interest in 55 claims lying contiguous to the northern boundary of Placer’s property. Previous drilling on Pangea’s north block has also encountered gold mineralization within the iron formation. Elsewhere in Ontario, near Matheson, a second drill has been added to the Fenn-Gibb property. Initial results from a 33,000-ft. program have proved encouraging for the company.