The Vancouver-based major will take down 1.1 million units of Freewest priced at 50 apiece. Of the $550,000 in total proceeds, Freewest will spend $350,000 on the Larose project before the end of 2004. Teck will hold a right of first refusal over any interest in the project that Freewest intends to sell, plus a right of first refusal, for one year, over any third-party offer for the property. Teck will also provide technical support to the project for at least a year.
The Larose project is 120 km west of Thunder Bay and about 10 km south of the Trans-Canada Highway. The property covers 35 sq. km of “Quetico-type” metasediments, which are separated by a major contact zone or boundary from adjacent metasedimentary and metavolcanic rocks of the Shebandowan greenstone belt. Freewest’s vice-president of exploration, Donald Hoy, says rocks mapped as Quetico-type sediments have seen only limited exploration, compared with the neighbouring metavolcanics of the Shebandowan belt. “Quetico wasn’t thought to be favourable at all for gold,” he tells The Northern Miner. “Nobody has really explored here much at all in the past, so it’s exciting because we have opened up this whole belt.”
Freewest optioned the Larose property in August 2003 after local prospector Russell Kwiatkowski discovered gold mineralization in an exposed shear zone that cut across a newly constructed bush road. This showing of sericitized and carbonated altered sediments, with some quartz veining, returned 4 grams gold per tonne in a grab sample.
To earn a 100% interest in the property, Freewest agreed to spend $500,000 on exploration over four years and make payments totalling $80,000 cash and 50,000 shares over the same period. The vendors retain a 3% net smelter return royalty.
“We hit it hard with prospecting and trenching in August,” says Hoy. “We’re getting bonanza gold grades of up to 371.9 grams [per tonne, or 10.8 oz. per ton] in grab samples.”
An auriferous corridor consisting of a series of discrete northeast-trending shear zones has been traced over a distance of at least 1,500 metres. The mineralized shear zones are oriented in the same direction as the major contact fault boundary separating the Shebandowan terrain. The sheared corridor cuts across a broad sequence of moderate-to-intensely-altered greywacke and argillite, which have been intruded by a series of quartz-feldspar porphyry sills.
The individual shears attain widths of up to 2.5 metres and are enveloped in a broader deformation zone at least 30 metres wide. The higher gold grades were found in grab samples taken from shear zones healed by quartz flooding and silicification, bearing moderate-to-appreciable pyrite, pyrrhotite, galena, sphalerite and arsenopyrite with lesser chalcopyrite and, locally, visible gold.
“We’ve established some pretty good values,” says Hoy, and indeed, grab sampling has delivered multi-ounce hits from several exposed showings along the corridor. “The bonanza grades are really not quartz veins at all; they’re more like alteration zones that are sericitized, with a bit of re-crystallized quartz.”
An induced-polarization geophysical survey over the prospective area revealed a strong chargeability anomaly extending beyond the area of exposed mineralization. Several other anomalies defined by the survey are parallel to the Main zone, which suggests repetition or folding.
In December 2003, the company tested a 130-metre-long segment of the main corridor with seven angle holes drilled from four sites. The drilling initially tested the Main zone to a depth of only 30 metres. The holes intersected auriferous zones of sheared, sericitized and quartz flooded greywacke, with narrow sections of high-grade.
Highlights include the following:
— 0.25 metre grading 8.81 grams gold per tonne in a broad, 3.5-metre-wide section averaging 1 gram gold, followed farther down-hole by 3 metres of 1.41 grams (including 0.1 metre of 31.7 grams), in hole 1;
— 4 metres averaging 1.5 grams gold (including half a metre of 8.67 grams) in hole 2, which undercut the first hole on the same section;
— 0.3 metre of 8 grams gold in hole 3;
— 5 metres averaging 2.27 grams gold in hole 4, which undercut hole 3;
— 10 grams gold across 0.5 metre or 3.45 grams across 2.7 metres in hole 5;
— 2 metres of 8.74 grams gold (including 0.5 metre of 29.1 grams) in hole 6, which was steepened from the same site as hole 5.
“This has been a good start to what will be an intensive, integrated effort to explore the new discovery,” says Freewest President Mackenzie Watson. “Much more diamond drilling will be required before we can get a handle on the controls and tenor of gold mineralization of this large mineralized structure.”
Several junior companies have staked small positions in the immediate area of Freewest’s discovery.
The Larose property is only 2.5 km northwest of
Pele acquired the project in 1996 and explored it until 1998, with most of the work centred on the Ardeen mine and its extensions to the northeast and southwest. Exploration consisted of line-cutting, geological mapping and prospecting, ground geophysics, soil and till sampling, trenching and diamond drilling (128 holes totalling 12,452 metres).
A preliminary estimate of resources in August 1998 showed five mineralized zones containing an inferred 991,739 tonnes grading 11.2 grams gold per tonne (357,000 oz. per ton), based on assays cut to 68.6 grams. This resource estimate was done prior to the implementation of National Instrument 43-101.
Pele returned to the property early last year and tested the extension of the Pele zone with four holes. Results were mixed.
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