Capitalizing on Global Demand for Base Metals
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Northern Lights Resources (CSE:NLR) is an advanced exploration company with two promising projects, one in Nevada and one in Mongolia.
The company’s flagship property, the Medicine Springs project in the state of Nevada, USA, is a historical producer of lead, zinc and silver. With supply concerns raising zinc prices nearly 30 percent in 2017 and with lead as the fourth-most-used metal globally, Northern Lights is positioned to capitalize a market with increasing demand for these metals.
The Medicine Springs mineralization is categorized as a carbonate replacement setting and occurs as high angle veins and breccias developed along faults and as shallow dipping stratiform replacement and intensively oxidized to depths exceeding 180 metres. There are two key exploration targets: 1) large scale zinc oxide surface deposit and 2) large scale zinc sulphide carbon replacement deposit similar in style to the Taylor Deeps deposit owned Arizona Mining Inc (TSX:AZ).
Significant exploration work was completed on the property in the 1980’s and 1990’s by US Minerals Exploration, USAX Cominco and Silver Resources. Northern Lights Resources is planning a detailed follow up exploration program beginning in 2018 that will include compilation of GIS data base of all historical results, detailed surface mapping, and an aeromagnetic geophysical survey over entire property. The results of this initial exploration program will identify targets for a drill program in late 2018 that would target the delineation of an initial NI43-101 resource for both the oxide deposit on surface and the sulphide mineralization at depth.
The Del Undur project is Northern Lights’ property is located in the North East Mongolian province of Dornod adjacent to both the Chinese and Russian border. Northern Lights has identified a large iron/titanium mineralisation footprint on the property, including the presence of both significant base and precious metals in near-surface trenching. The mineralization hosts a titanium feedstock mineral called Leuxocene that commands premium prices in the titanium feedstock market. The project holds the high potential a large scale surface ferro titanium deposit that can produce a high grade Leuxocene concentrate for the growing Chinese titanium and specialty steel market.
The company’s exploration goals for 2018 involve the validation of compilation of historic exploration results into a GIC data base, mineralogy testwork confirm Leuxocene potential, surface mapping and metallurgical test work on potential mineral recovery.
Northern Lights is debt free and the company’s management and insiders, currently own approximately 40 percent stake in the company. The Company has strong governance with an experienced board with strong capital markets and project development expertise.
- Both exploration projects situated in mining-friendly jurisdictions
- Capital structure: Northern Lights has no debt with 34 million shares fully diluted before current equity financing
- Global supply deficit for Zinc expected in coming years
- Growth in Chinese titanium demand
- Strong, experienced management team and board
- Potential for high grade carbon replacement zinc sulphide and zinc oxide deposits at Medicine Springs
- Pre-existing infrastructure at both the Nevada and Del Undur properties
- Northern Lights currently raising US$1.5 million to advance project goals for 2018
The Medicine Springs project
Comprised of 149 unpatented mineral claims and totalling 1,206 hectares in Elko, Nevada, the Medicine Springs project is focused on targeting the property’s silver-lead-zinc deposits. Northern Lights holds an option to acquire a 100 percent interest in the project over a six year term. Between 1910-1956, the project produced 160 tonnes of lead, 800 kilograms of zinc and 500 kilograms of silver from its mine shafts and shallow surface digging.
Infrastructure and climate
Found in the Medicine Range foothills, the Medicine Springs project is 160 kilometers southeast of Elko, Nevada. The project approaches 2,000 meters elevation and is easily accessible by a plethora of county and local access roads which all lead directly to the Golden Pipe headframe and its drill sites.
The site’s climate, dry warmth in summer and cool winters, is typical for northeastern Nevada. Precipitation is sporadic, with light rains and mild snow in winter and periodic thunderstorms in summer. Weather conditions, such as spring thaw, can occasionally affect dirt access roads, but exploration work can be conducted all-year.
Substantial exploration had previously been conducted on-site and identified a mineralized zone 3,400 meters in length and over 1,400 meters in width alongside numerous other sub-parallel northeast trending structures. Between 1982-2008, a total of 125 drill holes across 5,442 meters were drilled by USMX, USAX and Silver Reserve.
USAX, which held an option on the south half of the claim area between 1980-1994, carried out additional mapping, bulldozer trenching and prospecting in addition to their drilling. This exploration identified a large area of iron oxide-silica-carbonate-barite alteration over an approximate strike length of 1,600 meters at minimum extending northeast from the Silver Buttes project. The alteration seemed to be developed between prominent faults which run sub-parallel to the western fault, containing the Golden Pipe vein and breccia mineralization. Analysis shows the alteration area to contain various prospecting pits and shallow mining shafts, while sampling has indicated anomalous base metal and silver values.
One hole drilled by USMX 900 meters to the northeast of the Golden Pipe mine, in an area covered by post-mineral tertiary pyroclastics and pediment cover, intersected decalcified and mineralized limestone and included values of 2.06 percent lead, 2.8 percent zinc and 76.2 g/t silver at a depth of 42.5 meters and 1.5 meters across. Other holes reported grading as high as 4.59 percent lead, 0.02 percent zinc and 101.9 g/t silver. Drilling at nearby analogous geological sites has shown 63.2 million tonnes grading at 34.3 g/t silver and 0.31 g/t gold with inferred resources of 77.6 million tonnes at 34 g/t silver and 0.31 g/t gold.
Current exploration programs
Northern Lights’ exploration program for 2018 includes developing drill targets to identify large scale near surface oxide and deeper sulphide zinc/lead/silver carbonate replacement mineralization. Additionally, completing aeromagnetic surveys, a mobile metal ion survey of areas surrounding the Golden Pipe historic workings and surface and a structural appraisal of the license area using RADAR technology are all slated for 2018.
The Del Undur project
Northern Lights also holds the option to acquire a 100 percent interest in the Del Undur titanium polymetallic project in the northeastern Mongolian province of Dornod. The project possesses iron, titanium, gold, silver zinc and lead deposits.
The project totals 20,000 hectares and is located within 120 kilometers of the Russian and Chinese borders crossings. It benefits from its access to power infrastructure and both roads and railway access and has the potential to contain a large tonnage, low grade titanium iron deposit, capable of open pit mining with a low strip ratio.
Titanium iron deposits at the Del Undur project were first identified by a Russian conducted airborne magnetic survey in 1966. Exploration activity such as 38,000 hectares of surface mapping, 3,600 line meters of trenching and the assessment of 2,000 unique samples have been completed since the project vendors acquired the licence in 2010. A resource report drawing from the aforementioned exploration between 2010-2013 estimates an inferred resource of 497 metric tons grading 1.25 percent titanium dioxide and 18 percent iron, though these estimates are not verified to NI 43-101 standards.
Dornod Province, host to the Del Undur project, has exceptional mineral potential and is host to a significant amounts of fluorite, copper-gold, uranium and iron-titanium deposits. There is a large iron-titanium mineralisation footprint at the project with precious metals near to the surface. Grading has been analysed at over 4 g/t gold, over 600 g/t silver, more than 6 percent zinc and over 4 percent lead. Further potential lies in epithermal deposits of gold-silver-base metal and carbonate lead-zinc. Notable nearby mining projects within the province have reported grades of 1.49 g/t gold and 13.2 g/t silver at 12.2 metric tons, including 1.1 g/t gold within six kilometers of the Del Undur project.
Northern Lights’ exploration budget for the project in 2018, including overhead costs, is CAD$200,000 and involves validating exploration results; completing the NI 43-101 report, petrology and mineralogy testing across multiple zones; metallurgical testing to determine potential recovery of leucoxene into a saleable concentrate and interpreting geophysical surveys and 500 meters of shallow in-fill diamond drilling in the deposit’s center.
Albert (Rick) Timcke—Executive Chairman and President
Rick Timcke is a Vancouver based entrepreneur and financier who has been involved in public equity market roles for more than 26 years. Specializing in the marketing, funding, restructuring and formation of Canadian-based resource issuers listed on both Canadian and US exchanges. Over his career, he has held senior roles in listed public companies ranging from Investor Relations to being an Officer and Director. Previously held positions include: CEO of Northern Lights Resources Corp., Director of LiCo Energy Corp., Investor Relations of Nevada Energy Metals Inc., Corporate
Development/Investor Relations of Auracle Resources Ltd., President, CEO and Director of Tajiri Resources.
Jason Bahnsen—CEO and Director
Jason Bahnsen is a mining engineer with over 30 years of experience in natural-resources finance and operations. Prior to joining Northern Lights, he was CEO of Falcon Isle Resources (private), CEO of Strata Minerals Inc a TSXV listed phosphate explorer, CEO of Gobi Coal and Energy (private) Mongolian coal development company and director at Deutsche Bank AG, including serving as the head of Deutsche Bank’s Metals and Mining investment banking practice in Asia.
Graham Keevil—Non Executive Director
Graham Keevil brings 13 years of public company experience; specifically in the funding and management of publicly traded resources issues. He has worked with Teck Resources, Selkirk Metals, Pure Diamonds, Cross Lake Minerals, and a variety of other public ventures. He is currently president of Tajiri Resources, a TSXV junior explorer with projects in Guyana and Burkina Faso.
Richard A. Kelertas, Bscf, Mscf, RPF—Independent Director
For over 35 years, Richard Kelertas has held various positions in corporate Canada, encompassing sales, marketing, corporate development, corporate banking and equity capital markets. For 25 years, he has been a top ranked equity analyst and worked for various national and international firms. He was recently manager – special projects (Pulp & Paper) at Resolute Forest Products Ltd, and before that served as senior vice president of corporate development at Allana Potash Corp from May 1, 2012 to July 28, 2015. Previously he served as vice president and senior financial analyst at Dundee Canada and Scotia McLeod. He has also held senior corporate banking positions at National Bank of Canada and the Mercantile Bank of Canada. Before that he worked in the resources division of Noranda Inc and held various sales, marketing and corporate development positions. He has served as a director of Strata Minerals Inc from July 24, 2012 to April 01, 2016 and was CEO of Celeste Mining Corp from March 2013 until November, 2015.
Gordon Tainton—Independent Director
Gordon Tainton has over 25 years of experience at senior management levels in various sectors of the natural resources industry, including distribution, port/terminal development, trading, shipping, off-take agreements, and project finance. Within management teams, he has financed and developed port/terminal projects in the Americas, Asia and Oceania. He spent eight years with Sumitomo Corp of Tokyo sourcing, purchasing and delivering key intermediate bulk and bagged industrial mineral products. He is currently president and director of Focus Ventures Ltd, a TSXV listed company developing a large scale phosphate project in Peru.
A Munkhbayasgalan—Independent Director (Pending)
A Munkhbayasgalan is currently the chief regulatory officer, Mongolian Stock Exchange (MSE). Prior to joining MSE in 2017, he has held tenure both in private and public sector with 14 years of experience in banking, finance and public sector. His career includes director general of public investment department at the Ministry of Finance, head of marketing and product management department at Trade and Development Bank and CEO of Bloomberg TV Mongolia. He also served as board of member at State Bank of Mongolia and MIAT, the Mongolian airline company. In 2009-2015, he earned his MBA in public management in 2000 and a BA in management in 1999, majoring in finance, both at the University of Paris IX-Dauphine, France. He earned his high school diploma at Lycee Claude Bernard, Paris, France.
Gary Artmont—Head Geologist
Gary Artmont is a senior exploration geologist with over 40 years of international experience in regions including Canada, USA, Mexico, South America, Indonesia, Africa, Russia, China and Mongolia. He is a fellow member of AUSIMM and qualified to write NI 43-101 or JORC Competent Person reports for various exchanges. His exploration background extends from grassroots to project pre-feasibility studies. His working experience related to a wide variety of mineral settings that include, precious metals, ferrous and non-ferrous metals, industrial and energy commodities. He has held senior positions with Rio Tinto, Kennecott Australia, Freeport McMoran Indonesia, Union Carbide, Norilsk Nickel and Ivanhoe Mining. From 1989 to 1995, he served as the chief exploration geologist for Freeport responsible for conducting exploration over a 57,000-square-kilometer contract of work surrounding the world-class Grasberg deposit.
Leon Ho Interim—Interim CFO
Leon Ho is a chartered professional accountant working at Cross Davis & Company LLP, a chartered professional accountant firm providing accounting services to publicly listed entities, primarily in the mining sector. He works directly with mining CEOs and directors assisting with their regulatory and accounting needs.
Achit Erdene Darambbazar— Director General – Northern Lights Resources Corp Mongolia
Achit Darambbazar currently the CEO of MICC Capital a Mongolian based advisory firm. He has consistently distinguished himself as a pioneer within the Mongolian financial sector. In 2005, he founded MICC, making it the first investment advisory, stock underwriting and brokerage firm in the country. He acted as lead advisor for the first bond offerings on the local stock exchange by major Mongolian companies, MCS and Gobi Corporation. He also advised on a number of high-profile transactions in Mongolia, including the privatization of the Trade and Development Bank of Mongolia and Agricultural Bank. He consistently leverages his keen understanding of the local economy and his extensive network of contacts in the business community to advance the Mongolian financial sector. He holds a Master’s Degree in International Relations from Columbia University and earned his Bachelor’s degree from Middlebury College.
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