Queenston steps up Kirkland Lake program

The new joint venture of Queenston Mining (QMI-T) and Franco-Nevada Mining (FN-T) has outlined an ambitious exploration program for its large land package near Kirkland Lake, Ont.

Queenston’s president, Charles Page, told the company’s annual meeting that the $3.5-million program would concentrate on “drilling between the headframes, and that’s the best place to look.”

Queenston brought a large ground position to the table, which it had shared with Inco (N-T). The nickel miner had taken up gold exploration in the mid-1980s, placing Queenston’s McBean property into production, but ultimately pulled out of gold to concentrate on its core business. Most of the Inco Gold assets were sold to TVX Gold (TVX-T), though the subsidiary retained those in the Kirkland Lake area. Queenston hopes to close its purchase of Inco’s share in the properties by the end of June.

Queenston will test deep extensions of known mineralization along the Kirkland Lake-Larder Lake break. Deposits in the camp have characteristically steep plunges, and grades often improve with depth. Several deep holes previously drilled on Queenston properties intersected mineralization but have not been followed up.

The first phase of exploration is expected to start in late July or early August and should be finished before the end of October. Queenston has closed a $10-million financing to fund its share of the program, consisting of a private placement of 4 million warrants convertible to shares once a prospectus has been approved by securities regulators.

Another company active in the camp, Armistice Resources (ACI-M), has filed a preliminary prospectus with the Securities Commissions of Quebec and Ontario for the distribution of 7.5 million shares and 3.75 million purchase warrants. The shares and warrants will be issued on the exercise of 3.75 million special warrants, already subscribed for. The funds will be used to advance underground exploration at the old Sheldon-Larder property, where Armistice has been testing the down-plunge projection of the Kerr-Addison orebody.

The shaft has been deepened to 2,300 ft. and bulk sampling is planned at the 2,250-ft. level. The company will also drill-test mineralized zones above that level, and has plans for another financing to allow deep drilling of the Kerr extensions below the 4,000-ft. level.

Several other companies have announced plans for projects in the Kirkland Lake area. These include Kinross Gold (K-T), which has budgeted $3 million on exploration and plans new development at its Macassa mine, and Hemlo Gold (HEM-T), which will spend $2.3 million on a land package in McVittie Twp. At the Victoria Creek property, north of the main break, Sudbury Contact Mines (SUD-T) is sinking a 2,400-ft. shaft and drifting on three levels.