Pure Gold Mining has signed a definitive agreement to acquire the 219ha Derlak Gold Property in Ontario, Canada, from Orefinders Resources.
Under the terms, Pure Gold Mining will pay $500,000 in cash along with its 1,290,322 common shares. The Derlak Property consists of 11 mining claims.
Pure Gold president and CEO Darin Labrenz said: “Acquisition of the Derlak Property is consistent with Pure Gold’s strategy of consolidating properties in the Madsen Gold Project that have the potential to host high-grade gold deposits.
“Madsen historically produced well over 2.4 million ounces to a vertical depth of 1,200m, where it remains open down plunge. Large Archean gold systems typically have very deep roots, and drilling by previous operators confirms the down plunge extension of the Madsen mineralised system, intersecting high-grade gold at a depth of 2,100m.
“Our current phase of exploration at Madsen continues to focus along the Madsen-to-Starratt mineralized corridor, with surface and shallow underground exploration close to the existing permitted mining infrastructure. Madsen is a large gold system, and this strategic acquisition secures future large-scale exploration potential of Austin, which remains open to depth.”
The Madsen Gold Project claim package and the Derlak Property will provide exposure to a neighbouring 47km² land package for Pure Gold.
The new property package includes the key structural break in the Red Lake District which hosts past-producing gold mines of Howey, Hasaga, Buffalo, Madsen, and Starratt Olsen.
The acquisition also secures the long term future of Madsen’s north-east plunging Austin Horizon mineralisation.
Pure Gold stated that the projected upper limit of the Madsen mineralisation crosses the Derlak acquisition boundary at nearly 1.2km depth, while the projected lower limit crosses the Derlak acquisition boundary at approximately 2.2km depth.
The Madsen Mine operated for almost four decades with historic production of 2.5 million ounces at an average grade of 9.9g/t gold. It also hosts a permitted mill and tailings facility.
The Madsen Gold Project has an indicated resource of 928,000oz of gold at 8.93g/t (in 3.24 million tonnes) and an inferred resource of 297,000oz of gold at 11.74g/t gold (in 790,000t).