Muscocho, Flanagan deal with Greenstone Resources

Two Toronto-based mining companies, Muscocho Explorations and Flanagan McAdam Resources, have entered into an agreement with Greenstone Resources whereby they may jointly acquire up to a 50% interest in a 29-claim property containing the Gwillim gold mine, in the Chibougamau area of Quebec.

The Gwillim mine, Muscocho President J. T. Flanagan reports, operated from 1980 to 1984 and produced 244,000 tons averaging 0.143 oz per ton.

All mining was done above the 350-ft level, and in addition to possible lateral and downward extensions of the original ore zone, the property hosts at least eight other gold-bearing vein systems that remain to be fully tested, Mr Flanagan said.

The Muschocho-Flanagan McAdam partnership is already exploring a block of 38 claims adjoining east of the Gwillim mine property. Work to date on this Gwillim East project, in which Noranda Explorations has a 13.33% participating interest and a 20% net profits royalty interest, has outlined two parallel mineralized zones 3,000 and 4,000 ft long. A third zone lying 750 ft south and parallel to the existing south zone has also been encountered.

Detailed drilling on part of one of these structures has tested a 500-ft length which averages 0.45 oz uncut (or 0.21 oz with high assays cut to one oz per ton) across an average width of 9.5 ft.

This zone, Mr Flanagan said, is currently being extended by drilling as part of a $700,000 program which will test the two known gold- bearing structures and several other targets outlined by a recent induced polarization geophysical survey. Please insert after para #6:

On the third, or “new south” zone, two drill holes have returned favorable gold values. Hole No 87-5 cut a 4.75 ft core length running 0.14 oz at vertical depth of 820 ft, while hole No 87-6 intersected 8.03 ft running 0.47 oz at a vertical depth of 1,017 ft. The two intersections were approximately 250 ft apart.

Muscocho and Flanagan are equal partners in both of these projects. They can acquire their 50% Gwillim interest by paying Greenstone a total of $150,000 in cash and stock, subject to regulatory approval, and spending $2 million on the property within three years.

An exploration plan for the property is expected to be announced in the near future, Mr Flanagan said.