American CuMo Mining Corporation (TSXV:MLY,OTCPINK:MLYCF) announces the signing of an agreement to earn 100 percent interest in eight unpatented mining claims known as the Calida Mine Property located in southeastern Idaho.
Vancouver, British Columbia–(Newsfile Corp. – November 14, 2016) – “We are extremely pleased to add the Calida Mine Property to our portfolio. This is a highly prospective gold, silver and copper property that has significant historic drill results and has the potential of being developed in a relatively short period,” said Shaun Dykes, President and CEO of CuMoCo.
The Calida claims cover several significant mineralized gold, silver, and copper veins that range in width from 1.5 meters (5 feet) to more than 30 meters (100 feet) and have been exposed on the surface for approximately 4,267 meters (14,000 linear feet).
The agreement gives CuMoCo a ten-year option to earn 100 percent interest by making a series of payments. An initial payment of $40,000 US dollars has been made and ongoing payments consist of the following in US funds:
-$40,000 on or before 90 days of the effective date.
-$50,000 on or before six months of the effective date.
-$50,000 on or before 12 months of the effective date.
-$50,000 on or before 18 months of the effective date.
-$50,000 on or before 24 months of the effective date.
-$50,000 every six months until commercial production or ten years.
-$1 million at the start of commercial production.
The Calida agreement includes a variable buyout price, the Actual Exercise Price (AEP), that is based on the number of ounces of gold equivalent as defined in an independent 43-101 pre-feasibility or feasibility study. The AEP has a minimum price of $10 million dollars for one million ounces of gold equivalent, rising at the rate of $10 million dollars for each one million ounces of gold equivalent to a maximum price of $50 million dollars for greater than five million ounces of gold equivalent.
The property has been extensively explored for the past thirty years. Exploration has included drilling 23 holes in 1983 as well as thorough trenching and sampling. A total of ten mineralized veins have been identified on the property to date. Significant intersections from the drilling are listed below:
In 2009, an independent resource calculation using the historic data was completed which defined a resource of 8,059,304 tons grading 0.168 ounces gold/ton, 6.12 ounces silver/ton and 2.86 percent copper.
The 2009 resource is considered an historical resource, as a technical report on the resource was never filed although the calculation was completed. It is the qualified person’s opinion that the resource is reliable having been done by a reputable independent third party who verified data and checked assays. A qualified person has not done sufficient work to classify the historical estimate as a current mineral resource. The Company is not treating the resource as a “current resource” and does not intend to rely on this resource but will use it as a guide.
Examination of available data indicates a target area of at least 100 meters (328 feet) wide, 1500 meters (4921 feet) long and 500 meters (1640 feet) deep that contains gold with copper bearing mineralization. CuMoCo has constructed a three-dimensional model of the veins and has identified a preliminary exploration target of between 8 and 30 million tonnes grading between 5 and 10 grams per tonne gold, 150 to 200 grams per tonne silver and 2 to 3 percent copper.
The Company intends to further the exploration and cautions that the target, the potential quantity and grade is conceptual in nature as exploration work done to define Mineral Resources as defined by NI 43-101 has been insufficient. It is uncertain if further exploration will result in establishing the existence of Mineral Resources.
“It is important for our shareholders to know that we remain completely focused on developing the CuMo Project and advancing its towards production,” said Dykes. “Being a significant gold property, the Calida Mine provides an excellent opportunity to add value to the Company for its ongoing negotiations with Chinese or other investors.”