- Port Hope Simpson REE District
- Henley Harbour
- Strange Lake Earn-in
- Red Wine Complex Joint Venture
- Qualified Person
- Technical Reports
Red Wine Complex Joint Venture
On March 16, 2010, the Company entered into an option agreement (the "Letter Agreement") with Great Western Minerals Group Ltd. ("GWG") whereby GWG can acquire up to a 50% working interest in the Company's Red Wine property, located approximately 100km north-east of Churchill Falls, Labrador. Under the terms of the Letter Agreement, GWG will pay an aggregate of $225,000 and GWG will issue an aggregate of 1,050,000 common shares as follows:
- $50,000 (received) and 200,000 common shares of GWG on March 16, 2010 (received);
- $75,000 (received) and 350,000 common shares of GWG on or before April 30, 2011(received); and,
- $100,000 (received) and 500,000 common shares of GWG on or before April 30, 2012 (received)
GWG will also fund an exploration program of an aggregate of $1,500,000 of exploration expenditures as follows:
- $750,000 on or before March 16, 2011 (incurred);
- $250,000 on or before March 16, 2012 (incurred); and,
- $500,000 on or before March 16, 2013 (incurred)
The Company will be the operator of the exploration activities and GWG will pay the Company a 10% management fee, payable in cash.
On commencement of commercial production, GWG will have a three year renewable right (the "Marketing Arrangement") to market the Company's share of production of REE from the Red Wine property. The Company will retain the option to renew the Marketing Arrangement for each subsequent three year period.
The property consists of 9 map-staked licenses (013144M, 013306M, 016594M, 016596M, 016599M, 016601M, 016602M, 016628M, and 016676M) that encompass 301 claims (75 sq km).
The property is underlain by Proterozoic saturated and undersaturated volcanic (Letitia Lake Group) and plutonic rocks (Red Wine Complex) of the Red Wine Peralkaline Suite. Peralkaline syenites and nepheline syenites in the North Red Wine portion of the property contain up to 30% (visually estimated) of the Zr-Y-REE-bearing mineral eudialyte. These rocks will be the initial target of the exploration program.
Work on the property in 2009 consisted of reconnaissance prospecting, sampling and assay work. Twenty three grab samples were collected and assayed for trace, rare earth and major elements. Eudialyte-bearing samples gave up to 0.82% total rare earth elements + Y, with Dy values ranging from 275 to 602 ppm for six samples. The highest Zr value for these samples is 33,801 ppm (3.38%). The 2010 field program consisted of prospecting, channel sampling, mapping and diamond drilling.
Mapping and prospecting in 2010 identified six eudialyte showings on the property: Pinot Rose, Cabernet, Malbec, Zinfandel, Shiraz and Merlot. The Pinot Rose, Cabernet and Malbec showings have been channel sampled. A total of five holes, totaling 896m, at the Pinot Rose Showing and five holes, totaling 1002.4m at the Cabernet Showing were completed in the fall of 2010.
The 1,898m (10 hole) drill program confirmed that the previously reported surface eudialyte-bearing REE-Zr-Y mineralization continues to depth in the Pinot Rose' and Cabernet showings (refer to the March 5, 2011 news release). Analytical results for core samples indicate 550 ppm Dy, 3,451 ppm Y and 1.25% total REE (TREE; 1.59% Y+TREE) over 4 metres at the Cabernet showing. Metallurgical samples have been collected from three channels on the property.