GFG Resources Inc. (TSXV:GFG) (OTCQB:GFGSF)
(“
GFG” or the “
Company”) is
pleased to announce that it has entered into a purchase and sale
agreement (the “Agreement”) with Richmont Mines Inc. (“Richmont”),
a subsidiary of Alamos Gold Inc. (TSX:AGI) (NYSE:AGI), to acquire a
100% interest in the Sewell Property in exchange for 390,930 GFG
common shares. The Sewell Property is located 10 kilometres west of
Tahoe Resources’ West Timmins Gold Mine and is contiguous to
portions of the Pen Gold Project’s eastern boundary (
See
Figure 1). Following the acquisition of the Sewell
Property, GFG’s Pen Gold and Dore Gold properties will comprise
nearly 700 square kilometres (“km2”) in one of the most prolific
gold districts in the world.
Brian Skanderbeg, President and CEO of GFG,
commented, “The acquisition of the Sewell Property adds significant
exploration potential and complements our consolidation strategy in
one of the most prolific gold districts in the world. We believe
that the historic high-grade drill intercepts and grab samples on
the Sewell Property are part of a four-kilometre-long gold trend
that we have outlined in our new structural model. Like many
historical gold intercepts and occurrences in the Swayze Greenstone
Belt, there has been very little to no follow-up drilling or
modelling for over a decade. We will implement our strategic
approach to exploration on the new claims and follow-up on the
historic gold intercepts as part of our 8,000 metre drill program
in the third and fourth quarters on this very prospective region of
the Abitibi.”
Sewell Property Details The
Sewell Property hosts favourable geology and several historic
economic drill intercepts. Previous explorers, including Richmont,
Storimin Exploration Inc. and Noranda Mining Corporation of Canada,
targeted the Sewell Property along the Deerfoot Deformation Zone,
the same major structural corridor that exists on the Pen Gold
Project, with a total of 46 diamond drill holes. Highlights from
drilling along this interpreted structure include historical
intercepts(1) of:
- 60.2 g/t Au over 1.3 metres;
- 30.2 g/t Au over 1.2 metres;
- 18.9 g/t Au over 1.6 metres;
- 92.6 g/t Au over 0.6 metres;
- 11.1 g/t Au over 1.7 metres; and
- 28.5 g/t Au over 1.6 metres.
In addition to historic drill intercepts,
surface grab samples from trenching have returned results ranging
from 0.01 to 375 g/t Au. Gold mineralization occurs within and
adjacent to a sequence of moderately north-dipping quartz veins and
shear zones cutting a carbonate-altered diorite. The east-northeast
trending zone has been traced in drilling for 300 metres, to a
depth of 100 metres and remains open to the west onto the Pen Gold
property and down-plunge. The Company will incorporate the
Sewell Property in its 2018 exploration program and may allocate
drilling metres to follow-up on the historic drill intercepts.
Transaction Details Pursuant to
the Agreement dated May 30, 2018, GFG will purchase 100% of
Richmont’s interest in the Sewell Property, a land package
consisting of one legacy claim and five patented claims covering
approximately 3,000 hectares adjacent to GFG’s Pen Gold Project, in
exchange for 390,930 GFG common shares, representing an implied
purchase price of approximately C$100,000 based on GFG’s 10-day
VWAP. In addition, within five years after closing of the
Agreement, if GFG files an independent National Instrument 43-101
technical report on the Sewell Property (or on the Pen Gold Project
if such technical report includes all or a portion of the Sewell
Property) which outlines a mineral resource of at least 500,000
ounces of gold in respect of the claims comprising the Sewell
Property, Richmont will receive an additional 500,000 common shares
of GFG. Completion of the Sewell Property acquisition is subject to
certain customary closing conditions, including approval of the
TSXV. The issued GFG common shares are subject to a customary four
month hold period.
Figure 1: Pen Gold Project Including
Recently Acquired Sewell
Propertyhttps://www.gfgresources.com/files/images/projects/Fig-1_GFG-Resources_Pen-Gold_Highlights_Sewell-Acquisition.jpg
Footnote (1) Drill intercepts
are presented using a 3 g/t Au cut-off and as drilled length. True
width is estimated to be 70 to 90% of drilled length. The QP has
not verified the laboratory accreditation, analytical method,
sample size or QA/QC procedures utilized for the historic drill
results or grab samples.
Qualified PersonsBrian
Skanderbeg, P.Geo. and M.Sc., serves as President and CEO of GFG,
and is a “qualified person” within the meaning of National
Instrument 43-101 – Standards of Disclosure for Mineral Projects.
Mr. Skanderbeg has reviewed and approved the information contained
in this news release.
For further information, please contact:
Brian Skanderbeg, President & CEOPhone: (306) 931-0930 or
Marc Lepage, Vice President, Business Development Phone: (306)
931-0930 Email: info@gfgresources.com
Website: www.gfgresources.com
Twitter: @gfgresourcesLinkedIn:
https://linkedin.com/company/gfgresources/
About GFG Resources Inc. GFG
Resources is a North American precious metals exploration company
headquartered in Saskatoon, Saskatchewan, Canada, whose shares
trade on the TSX Venture Exchange (GFG) and on the OTCQB (GFGSF).
The Company owns 100% of two large and highly prospective gold
properties west of the prolific gold district of Timmins, Ontario,
Canada. The Ontario properties are comprised of the 44,500-hectare
Pen Gold Project (including the West Porcupine property) and the
20,000-hectare Dore Gold Project. The Company also controls
100% of the Rattlesnake Hills Gold Project, a district scale gold
exploration project located approximately 100 kilometres southwest
of Casper, Wyoming, U.S. The geologic setting, alteration and
mineralization seen in the Rattlesnake Hills are similar to other
gold deposits of the Rocky Mountain alkaline province which,
collectively, have produced over 50 million ounces of gold.
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
CAUTION REGARDING FORWARD-LOOKING
INFORMATIONAll statements, other than statements of
historical fact, contained in this news release constitute
“forward-looking information” within the meaning of applicable
Canadian securities laws and “forward-looking statements” within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 (referred to herein as “forward-looking
statements”). Forward-looking statements include, but are not
limited to, disclosure regarding possible events, the proposed
completion of the acquisition of the Sewell Property (the
“Transaction”), conditions or financial performance that is based
on assumptions about future economic conditions and courses of
action; planned use of proceeds, expenditures and budgets and the
execution thereof. Generally, these forward-looking
statements can be identified by the use of forward-looking
terminology such as “plans”, “expects” or “does not expect”, “is
expected”, “budget”, “scheduled”, “estimates”, “forecasts”,
“intends”, “anticipates” or “does not anticipate” or “believes”, or
the negative connotation thereof or variations of such words and
phrases or state that certain actions, events or results, “may”,
“could”, “would”, “will”, “might” or “will be taken”, “occur” or
“be achieved” or the negative connotation thereof.
All forward-looking statements are based on
various assumptions, including, without limitation, the
expectations and beliefs of management, the assumed long-term price
of gold, that the current exploration and other objectives
concerning its mineral projects can be achieved and that its other
corporate activities will proceed as expected; that the current
price and demand for gold will be sustained or will improve; the
continuity of the price of gold and other metals, economic and
political conditions and operations; that all conditions precedent
to the Transaction, including requisite regulatory approval will be
fulfilled in a timely manner and on acceptable terms; and that
general business and economic conditions will not change in a
materially adverse manner.
Forward-looking statements are subject to known
and unknown risks, uncertainties and other factors that may cause
the actual results, level of activity, performance or achievements
of GFG to be materially different from those expressed or implied
by such forward-looking statements, including but not limited to:
risks and uncertainties related to the Transactions not being
completed in the event that any of the conditions precedent thereto
are not satisfied; actual results of current exploration
activities; environmental risks; future prices of gold; operating
risks; accidents, labour issues and other risks of the mining
industry; delays in obtaining government approvals or financing;
and other risks and uncertainties. These risks and
uncertainties are not, and should not be construed as being,
exhaustive.
Although GFG has attempted to identify important
factors that could cause actual results to differ materially from
those contained in forward-looking statements, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
In addition, forward-looking statements are provided solely for the
purpose of providing information about management’s current
expectations and plans and allowing investors and others to get a
better understanding of our operating environment.
Accordingly, readers should not place undue reliance on
forward-looking statements.
Forward-looking statements in this news release
are made as of the date hereof and GFG assume no obligation to
update any forward-looking statements, except as required by
applicable laws.
A photo accompanying this announcement is available at
http://www.globenewswire.com/NewsRoom/AttachmentNg/563d80cb-bd58-420d-b2b0-8a280c84e3df
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