VANCOUVER, Sept. 20, 2018 /CNW/ - Montego Resources Inc. (CSE: MY) (the "Company" or "Montego") is pleased to announce that it has reached an agreement with Altiplano Minerals Ltd. (the "Vendor") to acquire a series of mining claims located in Idaho County in the State of Idaho and commonly referred as the "Orogrande Gold Project" (the "Property").
The Property is a "drive to" early stage gold target comprised of 199 unpatented lode claims totalling 4,000 acres and located approximately 100km southeast of Grangeville, Idaho and 15km southwest of Elk City, Idaho all within the Nez Perce National Forest near the headwaters of the Crooked River.
The Orogrande Gold Project is hosted within the Orogrande Shear Zone (OSZ), a 40+km long and up to 200m wide regional shear zone located at the contact between the Cretaceous Idaho Batholith and the metamorphosed Proterozoic Belt-Purcell Sedimentary rocks. The OSZ strikes north to south through the Property and is bounded by NNW to NW trending steeply faults. Hydrothermal alteration is spatially associated with the OSZ and consists of silicification, argillization, chloritization and dolomite. Mineralization here is hosted by two types of broadly defined deposit types including Cretaceous to Tertiary epithermal deposits and older orogenic shear zone deposits hosted within the batholith. Mineralization includes disseminated low grade precious metal mineralization in associated stockwork veins, breccias and extensive widespread alteration; high grade gold associated with discreet structurally controlled quartz veins and silicified zones and; native high grade gold associated with quartz vein lodes and lenses in granodiorite, Tertiary dacite or at contacts between granodiorite and Proterozoic metasedimentary schist and/or gneiss. Both types of mineralization have been identified on the Property and on an adjacent property which contains a resource of 647,000 ounces of gold at 1.0 g/t Indicated and 590,000 ounces at 0.88 g/t Inferred (2013 Premium Exploration Inc, Technical Report, and Idaho Gold Project). Though the geology and structural setting on the Orogrande Gold Project is similar to that of the mineralization on Premium's adjacent property, mineralization hosted on the Premium Exploration Inc. Idaho Gold Project is not necessarily indicative of the mineralization hosted on the Property.
Placer gold production in the entire Orogrande District is estimated at up to 3 million ounces between 1861 and 1872 (Reid, R. R., 1959, Reconnaissance Geology of the Elk City region, Idaho: Idaho Bureau of Mines and Geology Pamphlet 120, 74 p). Historic load gold production occurred on the Property, with a few historic producers including the Gold Master, Gold Bug, Hematite, Eutopia, Badger Summit and Badger Shaft. More recently, mapping highlighted gold bearing structures and outcrop and large areas of intense alteration. A 2011 soil sampling program consisting of 1,548 b-soils identified multiple gold-in-soils anomalies which highlight areas of known mineralization and further, areas of heretofore unexplored portions of the Property. Significant fault structures have also been identified.
No work has been completed on the Property since 2011, and no known drilling has occurred.
Overall highlights of the Orogrande Gold Project include:
- Established mineral tenure and permitting procedures in a politically stable jurisdiction.
- Easy access via a system of state, county and local gravel roads
- Favourable stratigraphy and geological setting in a region of known gold mineralization, identification and, production
- Past work on the Property identified previous load gold mining and more recent work including mapping and soil sampling identified gold bearing structures, zones of intense alteration and gold-in-soils anomlies which will allow for quick near term focus.
- Work by Premium on adjacent claims has used gold-in-soil anomalies successfully as a drill hole targeting tool and clear guides to mineralization at depth and defined six documented mineralized zones along the Orogrande Shear Zone (OSZ)
- Apex Geoscience LTD (Apex) completed a 43-101 Technical Report for the Vendor in 2016 and found the Orogrande Gold Project a property of merit with further work warranted. They (APEX) recommend a Phase 1 scope of work including soils, geologic mapping, and a VTEM Geophysical Survey. Expected Phase 1 all in cost is $300,000.
In consideration for the Property, the Company will make a one-time cash payment of US$50,000 and will issue 520,000 common shares to the Vendor at a deemed price of Cdn$0.25 per share. All shares issued to the Vendor will be subject to a four-month-and-one-day statutory hold period, as well as a voluntary escrow arrangement. One-third of the shares will be released from the escrow arrangement every twelve months for a thirty-six-month period. Following completion of the transaction, the Property will remain subject to a 1.5% net smelter returns royalty on commercial production in favour of a previous owner.
Completion of the transaction with the Vendor and the acquisition of the rights to the Property, remains subject to the satisfaction of a number of conditions, including the completion of filings with the Canadian Securities Exchange on behalf of the Company and certain other closing conditions as are customary in transactions of this nature. There can be no assurance that these outstanding conditions will be satisfied.
The scientific and technical data contained in this news release was reviewed by William Cronk, P.Geo., a non-independent qualified person to the Company. Mr. Cronk is responsible for ensuring that the geologic information provided in this news release is accurate and acts as a qualified person pursuant to National Instrument 43-101 – Standards of Disclosure for Mineral Projects.
ON BEHALF OF THE BOARD OF MONTEGO RESOURCES INC.
Chief Executive Officer
NEITHER THE CANADIAN SECURITIES EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE.
This press release includes "forward-looking statements" including forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. The Company does not assume the obligation to update any forward-looking statement, except as required by applicable law.
SOURCE Montego Resources Inc.
For further information: Montego Resources Inc., Suite 800 - 1199 West Hastings Street, Vancouver, BC, V6E 3T5, T 604-283-1722, F 888-241-5996