Abitibi holds more promise for project generator Transition Metals

1st August 2012 By: Henry Lazenby - Creamer Media Deputy Editor: North America

TORONTO (miningweekly.com) – The prolific Abitibi greenstone belt straddling the Ontario/Quebec border continues to provide compelling opportunities for new gold discoveries, and project generator Transition Metals recently confirmed this by acquiring two more projects in the region.

The company’s latest acquisitions located to the south-west of the Abitibi, the Golden Elk and Elephant Head properties, brought its total number of projects in the region to seven.

Transition CEO Scott McLean on Tuesday told Mining Weekly Online that the company is increasingly excited about the little-explored Ridout fault, where two of its other promising projects, the Haultain and New Kirkland projects, as well as the two new acquisitions, were located.

“We concentrate on the Abitibi belt owing to it having historically produced more than 170-million ounces of gold, making the region responsible for about 80% of Canada’s total gold production,” he said during an interview.

Canada hosts the most gold in the world at 430-million ounces, while it has the second-highest average grade of gold ore, placing the country, in terms of quality, only next in line to the famous Witwatersrand gold deposits of South Africa.

What makes it more attractive for project generators such as Transition, is the fact that the Abitibi region holds some of the last high-grade ore deposits left in the world, making it an ideal hunting ground for new projects.

The region’s proximity to infrastructure, including power, water, mills, road and rail transport and its skilled labour force adds to the allure of the Abitibi belt.

“Despite the region’s prolific history of gold production, much of the Abitibi remains underexplored,” McLean said.

Transition, whose business strategy focuses on the discovery/exploration side of the project value curve, were drawn to the Abitibi mainly as a result of its relatively high availability of closed mines and secondary structures, numerous windows of Archean rock formations in which gold is often found, and previously unavailable land holdings in prospective areas.

The Golden Elk and Elephant Head properties are located next to the company’s flagship Haultain discovery, where surface prospecting had returned grades as high as 97.6 g/t gold.

“We are extremely excited about our projects on the Ridout fault, as our prospecting thus far had proved the fault to be identical to the 41-million ounce Kirkland Lake Gold mining camp, situated on the Cadillac Larder break, which runs parallel to the Ridout fault,” he said.

At the Golden Elk property Transition had consolidated, through staking and option agreements with private landholders, about 13 km2 of property surrounding a previously producing gold deposit near Elk Lake, in Tudhope Township, Ontario.

The deposit, historically known as the Frontenac gold mine, operated on a small scale between 1904 and 1907, with no record of any subsequent exploration having been undertaken on the property.

Samples collected by Transition from a large waste pile located next to the shallow shafts returned assay values ranging from nil up to 7.12 g/t gold.

“Like the Haultain deposit, the property includes a window of exposed Archean greenstone,” McLean said.

The company’s Elephant Head property is about 25 km2 in size, and is located in Connaught Township, about 30 km east of Iamgold’s Côté Lake deposit, along the interpreted extension of the Ridout structure.

The Elephant Head property was acquired to investigate a number of historic gold showings associated with shear zones developed in granitic rocks, located south of the Ridout fault.

The property has similar geological and structural characteristics to those associated with the Chester 1 and Chester 2 deposits, located east of the Côté Lake deposit. Grab samples collected by Transition in the vicinity of these historic showings have returned initial values ranging from nil to 13.6 g/t gold.

At the eastern end of the current known range of the Ridout fault lies the New Kirkland property, which Transition staked near the end of last year. The 26 km2 of mining claims in the Kirkland Lake area had returned grab samples of up to 46.7 g/t gold and up to 2.59% copper.

Transition in June also staked a 100% interest in a land package covering about 68 km2, including the Janice Lake, Jansem 1, Jansem 2, Kaz Lake, Rafuse Lake, Genie Lake, Juno and Sunshine copper occurrences, located about 190 km north of La Ronge, and 55 km south-east of Key Lake, in north-central Saskatchewan.

“This is an exciting addition to our growing portfolio of projects. While the company’s core focus continues to be on gold, this project provides shareholders with exposure to copper. The geological environment and mineralisation suggests the property is capable of hosting a sizable sediment-hosted stratiform copper deposit,” McLean said.

He added that as a project generator, Transition’s priority now is to find suitable partners to help advance exploration on its projects.

The company’s stock traded at 22 Canadian cents on the TSX-V on Tuesday.