StrikePoint buys high-grade silver project

StrikePoint Gold Inc. July 16 said it has closed a deal to acquire Porter Idaho, a high-grade silver property in British Columbia's Golden Triangle, from Skeena Resources Ltd.

Porter Idaho hosts the historic Silverado and Prosperity-Porter Idaho mines, silver-rich vein systems about 2,000 meters apart, on opposite sides of Mount Rainey.

StrikePoint Gold said recent glacial retreat has exposed the ground between these past producing mines sites, providing the first opportunity to explore for a connection between the two deposits.

According to a resource estimate prepared for Mount Rainey Silver in 2012, Porter Idaho has 394,700 metric tons of indicated resource averaging 868 g/t silver (11 million ounces) silver, 3.37 percent lead and 1.41 percent zinc; and 88,900 metric tons of inferred resources grading 595 g/t (1.7 million oz) silver.

Porter Idaho is part of a larger package of properties Skeena picked up last year when it bought Mount Rainey Silver Inc. in 2016.

This larger land package includes the Glacier Creek claims, a road accessible claims adjacent to the historical Dunwell Mine, which produced 9,800 oz of gold and 329,000 oz of silver from 50,000 tons of ore between 1926 and 1941.

Sporadic underground sampling was undertaken in the old workings at Glacier Creek in the 1950s and 1980s, but no surface work has been completed since the discovery early in the 20th Century. StrikePoint said this lack of exploration makes this property open to the potential for new discoveries.

Several municipal lots in the nearby town of Stewart were also part of the deal.

StrikePoint has agreed to acquire the Mount Rainey shares, which comes with all the associated properties, in exchange for 9.5 million StrikePoint shares, representing approximately 12 percent of the company's outstanding shares of StrikePoint; C$1.5 million in cash – C$250,000 paid on closing and the balance to be made in instalments by the end of 2019. In addition, Skeena is retaining a 1 percent net smelter return royalty on the Porter Idaho property, half of which can be bought back by StrikePoint for C$750,000.

"We are happy with the terms of the deal with StrikePoint for Porter Idaho. It divests a non-core project, which generates cash for Skeena while at the same time allowing us to participate in potential upside on the property via our new share position in StrikePoint," said Skeena CEO Walter Coles. "Porter Idaho is an exciting high-grade silver asset and we look forward to drill results from StrikePoint's soon to commence exploration program."

StrikePoint which completed two months of due-diligence prior to the acquisition, said exploration activities will be underway shortly. The Vancouver-based explorer said a review of historical documents indicate a structural relationship between the historical Porter Idaho and Silverado mines and work will focus on bridging these two zones through a combination of mapping and diamond drilling.

–SHANE LASLEY