The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
North of 60 Mining News - August 7, 2024
A drill tests an extension of the Breccia Pipe deposit during Avidian's 2021 program at Golden Zone.
The second hole of Avidian's 2020 drill program at Amanita cut 22.7 meters of 3.11 g/t gold from a depth of 76.4 meters.
Avidian Gold Corp. Aug. 7 announced that it has finalized the sale of its Alaskan subsidiary, Avidian Gold Alaska Inc., to Contango ORE Inc. for $2.4 million (C$3.3 million), plus a potential future payment of $1 million (C$1.4 million) if Contango decides to develop a mine at the mineral exploration projects that came with the sale.
With the purchase, Contango ORE gains ownership of three properties – the Golden Zone gold-silver-copper project midway between Fairbanks and Anchorage; and the Amanita and Amanita NE properties adjacent to Kinross Gold Corp.'s Fort Knox mine north of Fairbanks, Alaska.
Golden Zone hosts several precious and base metal targets along a roughly 2.5-mile (four kilometers) corridor that is part of a longer mineralized trend. The most advanced target along this corridor is Breccia Pipe, a deposit with 4.19 million metric tons of indicated resource averaging 1.99 g/t (267,400 ounces) gold and 10.38 g/t (1.4 million oz) silver.
Golden Zone Corridor also hosts several other targets with strong gold, silver, and copper mineralization, along with elevated zinc and molybdenum.
Amanita and Amanita NE are early-stage gold properties where past sampling and drilling have indicated the potential for near-surface gold deposits.
Highlights from historical drilling on the Amanita properties include:
• 22.7 meters averaging 3.11 g/t gold
• 4.6 meters averaging 11.49 g/t gold.
• 24.2 meters averaging 1.3 g/t gold.
• 12.2 meters averaging 2.28 g/t gold.
• 13.7 meters averaging 3.02 g/t gold.
To gain full ownership of these properties, Contango paid $400,000 in cash and issued $2 million in Contango shares to Avidian.
"With this transaction now completed the company will commence shoring up its balance sheet and focus on a value creation strategy for its 100% owned Jungo gold-copper project in Nevada and continue ongoing evaluation of a number of possible strategic opportunities/alternatives that could be transformational for the company," said Avidian Gold Chairman Dino Titaro.
For Contango, this transaction adds to the pipeline of Alaska mineral exploration projects the company is advancing under its "hybrid royalty model," a strategy to reduce the environmental footprint and lower the capital costs associated with developing smaller high-quality mineral assets by direct shipping the ore to existing mills for processing.
In July, Contango celebrated the first gold poured from Manh Choh, the first mine brought into production under this unique model. Kinross, which joined the Manh Choh project under a joint venture with Contango, operates the mine and is shipping the ore to its Fort Knox Mine for processing.
With Manh Choh in production, Contango is focused on applying a similar direct shipping ore strategy to its Johnson Tract and Lucky Shot gold projects in Southcentral Alaska.
Golden Zone and Amanita are expected to be added to the pipeline of early-stage Alaska projects in Contango's portfolio.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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