Belmont Resources Inc. [BEA-TSXV; L3L1-FSE] said Wednesday September 4 that it has struck a deal with Pistol Bay Mining Inc. [PST-TSXV; SLTFF-OTC; OQS2-FSE] to acquire a significant land position on the Confederation Lake greenstone belt, approximately 70 kilometres southeast of Red Lake, northwestern Ontario.
Belmont said it has agreed to acquire a 65% interest in Pistol Bay’s Fredart/Gerry Lake property and several adjoining claims in the Confederation Lake belt.
The Arrow Zone/Garnet Lake, an adjoining claim block also owned by Pistol Bay, contains a NI 43-101-compliant inferred mineral resource of 2.1 million tonnes at 5.78% zinc, 0.72% copper, 195 g/t silver and 0.60 g/t gold.
The property is also 25 kilometres southeast of Great Bear Resources Ltd.’s [GBR-TSXV] Dixie Lake Project, where Great Bear has been reporting high-grade gold intersections, and attracting the attention of key mining industry players, including Bay Street financier Rob McEwen and his company McEwen Mining Inc. [MUX-TSX, NYSE].
“The geological setting of the Fredart and associated claims is similar to the Garnet Lake claims area,” Belmont said in a press release, Wednesday.
Belmont is an emerging resource company with interests in projects in the U.S. and Canada, including the Kibby Basin Lithium project. It is also exploring for uranium with partner International Montoro Resources Inc. [IMT-TSXV, IMTFF-OTC] in the Uranium City District of northern Saskatchewan.
Under the agreement with Pistol Bay, Belmont can earn a 65% stake in the Fredart/Gerry Lake property and several adjoining claims by making cash payments of $140,000 and delivering 4.0 million shares by the second anniversary of exchange approval.
On Wednesday, Belmont shares advanced on the news, rising 9% or $0.005 to $0.06. The shares are currently trading in a 52-week range of $0.04 and 76 cents.
Belmont can increase its stake in the properties to 75% upon completion of second anniversary obligations by paying $200,000 in cash. Belmont and Pistol Bay would then enter into a joint venture agreement.
A 2% net smelter royalty (NSR) is payable to Swiss commodities trader Glencore Plc on all claims except the Fredart claims, where a 2% NSR royalty is payable to Perry English, with a $10,000 annual advance royalty payment to English.
The Fredart property and the additional claim units cover 406 mining claims or 6,700 hectares, including a 17-kilometre length of the Confederation Lake greenstone belt. The property was the venue for 124 drill holes (22,500 metres) that were completed between 1956 and 2003.
The Copperlode “A” or Fredart Zone has a historical mineral resource of 425,000 tonnes grading 1.56% copper. However, this historical resource does not comply with NI 43-101 standards of disclosure. The zone was drilled tested to a depth of approximately 200 metres over a length of 350 metres and was reported as being open at depth.
Only a portion of the drill holes were assayed for gold, due to the low price of gold at the time. The area was also explored for molybdenum in the 1970s, and sample containing up to 1.46% molybdenum were reported.