Millstream nabs remainder of Potter property

Toronto-based Millstream Mines (MLSM-C) has acquired the remaining interest in the Potter polymetallic property in Munro Twp., 80 km east of Timmins, Ont.

The junior paid a private vendor $3 million and issued a promissory note for the remainder of the $4.6-million price tag. As part of the deal, the vendor exercised 3 million previously acquired warrants at $1 each and will retain a 2.5% net smelter return royalty. Millstream has the option of purchasing the royalty for $3 million.

Millstream’s initial work on the Potter property dates back to early 1996, when geophysical surveys were initiated to trace possible strike extensions of a mineralized horizon that was mined by previous owners up to 1971. While mineralization was intersected in follow-up drilling, results proved somewhat disappointing; the best intersection was 0.5 metre of 1.47% copper.

More recent work on the property has generated better success. Testing for mineralization below underground workings, six drill holes have outlined broad envelopes of sulphide-bearing mineralization containing narrower intervals enriched in copper, zinc, cobalt, silver and minor gold.

Mineralization is associated with a mafic fragmental unit, with layers of graphite, that strikes northwesterly and dips steeply to the north. The mineralization also plunges steeply to the west and is believed to thicken downdip.

The most recently drilled hole, 98-1, intersected three separate mineralized intervals ranging from 2.15 metres to 7.75 metres in width. The widest interval assayed 5.34% copper, 3.24% zinc, 0.07% cobalt and 39.8 grams silver per tonne, while the narrowest of the three graded 2.95% copper, 5.42% zinc, 0.05% cobalt and 20.9 grams silver.

Hole 98-1 was collared 50 metres west of hole 97-10 to test a conductor outlined by borehole and surface geophysical surveys. A number of similar targets remain untested.

Millstream says a number of majors have approached it for a joint-venture deal. The company will weigh the merits of such an arrangement against those of raising funds in the market, and will also consider a combination of the two.