TomaGold sells 25% interest in Monster Lake project to Iamgold

TomaGold (TSXV: LOT) is selling its 25% interest in the Monster Lake project to Iamgold (TSX: IMG; NYSE: IAG).

Under the sales agreement, Iamgold will pay TomaGold $500,000 in cash and $8 million in shares.

Iamgold holds a 75% interest in the Monster Lake project, 45 km southwest of Chibougamau, Quebec.

“This is a great transaction for TomaGold, as it will allow us to refocus our efforts on exploration with a combined cash and share position of over $10 million,” David Grondin, TomaGold’s president and chief executive, said in a statement.

“We are proud of what we have accomplished with Monster Lake, taking a promising exploration gold project and developing it into a high-grade gold deposit with the help of our joint-venture partner, Iamgold.”

The project contains inferred resources of 1.11 million tonnes grading 12.14 grams gold per tonne for 433,300 contained oz. gold. The resource estimate uses a cutoff grade of 3.5 grams gold per tonne.

The resource area measures 1,250 metres along strike, 350 metres in width, and runs 700 metres deep. The resource estimate is based on a compilation of historical and recent diamond drill holes and wireframed mineralized zones constructed by InnovExplo, an exploration and mining consulting firm headquartered in Val-d’Or.

TomaGold recently reported assay results from six drill holes totalling 2,991 metres that were designed to test priority areas along strike of the main Monster Lake structural corridor, which hosts the 325-Megane zone.

The drilling focused on testing the Annie shear zone, which extends northeast along strike of the 325-Megane zone.

Highlights from the 2020 drilling program on the Annie shear zone include drill hole 20-253, which intersected 4 metres grading 16.89 grams gold per tonne starting from 341 metres downhole, including 1 metre grading 7.36 grams gold and 1 metre grading 66.50 grams gold.

On the Big Mama shear zone, drill hole 20-251 cut 3 metres grading 5.63 grams gold from 239 metres, and on the Main shear zone, hole 20-252 returned 12 metres grading 2.09 grams gold from 342 metres.

The company said the drill results will be incorporated into its structural and deposit models and guide the next drill programs. Other work includes geological and geochemical surveys and regional structural studies, which will continue to support exploration targeting.

At press time in Toronto, TomaGold was trading at 8¢ per share within a 52-week trading range of 6¢ and 9¢. The company has 140 million common shares outstanding for an $11.2-million market capitalization.