A lot of exploration is about looking for pointers, for clues, as to where a deposit might be. For Canadian Orebodies, a train of boulders, a number of which had high-grade gold mineralization pointed in a particular direction.
If you look at the map above you can spot the boulder train. Angular boulders which suggest that the source is not far away. (click here for larger map)
If you follow the boulder train “up ice” – because the boulders were almost certainly the result of glaciation – you will see what Gordon McKinnon and his team at Canadian Orebodies have been quietly working on for the past nine months. The acquisition of the “Century Mining Claims”.
It was not straightforward.
“Century Mining was in bankruptcy,” said McKinnon. “And Teck Resources held a bunch of rights including the right of first refusal and a back-in right. There were also two prospectors who had a 3% Net Smelter Royalty, which made for a drawn out five-party negotiation. After nine months of discussions, we managed to get Teck to give up its rights in exchange for a 0.5% NSR, and we negotiated a royalty buy down with the prospectors. Eventually, we got what we wanted and we finalized the acquisition of the property.
In the February 20, 2018 press release announcing the acquisition McKinnon stated, “The Goodchild Lake acquisition covers a highly prospective property that hosts numerous high grade historical showings. Due to the bankruptcy proceedings these claims have not seen any follow up exploration in over a decade and a half. With this acquisition the Company has solidified its land position in the area, which will allow for an aggressive and systematic 2018 exploration program of this gold bearing system.”
As well as being at the head of the boulder train, the Century Mining Claims fit into Canadian Orebodies wider understanding of the prospective geology within the surrounding property. “This is ground that has been relatively untouched in recent years. We’re looking forward to getting on the property in the spring.”
“We’ve also had excellent results at Wire Lake. A property that had not been explored for over twenty years. We carried out a 21 hole drilling program and nearly every hole hit gold mineralization – anomalous if not reportable gold,” said McKinnon. “All the mineralization was near surface and we had long intercepts, which included 18 meters of better than 2 grams per ton gold and over 30 metres of 1.4 grams per ton gold.”
“Understanding the structure is very important here. At Wire Lake we’re looking for bigger intervals or better grade,” said McKinnon. “At the end of last season we discovered a new gold zone on surface about 600 metres to the south of the known Wire Lake Gold Zone. Within that zone we found our highest grade surface sample at Wire Lake. After some follow up work this spring we’ll likely look to drill the area to the south in the Fall. We’re also looking at drilling a number of deeper targets – below 500 meters. Currently our deepest hole is 300 meters but that was drilled on a 45 degree angle.”
“At Hemlo it was deep,” said McKinnon. “We want to work our way down. We’re on the same greenstone belt. But remember, at Hemlo it took 76 holes before they hit the orebody. Where is the sweet spot?”
Finding that sweet spot and exploring its newly acquired land is Canadian Orebodies 2018 mission. The company has a drill on the property and is just waiting for spring.
“It takes time to do the right work,” said McKinnon. “We’re in great financial shape so we can take the time.” The company has approximately 2.5 million dollars in its treasury. As importantly, it has great investors holding the bulk of it stock. Northfield Capital holds 17%. Osisko Mining owns another 14% and management holds almost 20%. Other larger investors hold nearly an additional 10% which means that the share distribution for the company remains very tight. None of these investors will be selling their shares for a few pennies profit.
For the moment, Canadian Orebodies has the money, the drill, the crew and the geologists to search its large property for that “sweet spot.” The market will be watching. Because the shares are tightly held, decent results will propel the shares; but excellent results, locating the “sweet spot” will likely have the markets betting that McKinnon has found Hemlo II.