Background and Option Terms
February 2017 Golden Predator Mining Option Agreement
Golden Predator may acquire Precipitate Gold’s 100% interest the Reef property located immediately adjacent to the northern boundary of Golden Predator’s 3 Aces Project in the Upper Hyland River area of the southeast region of the Yukon Territory. The three year option agreement grants Golden Predator the exclusive right to earn a 100% interest in the Reef property by, among other things, completing staged payments totalling $1,050,000 in cash, approximately $900,000 in Golden Predator common shares, and 800,000 three-year warrants exercisable for the purchase of additional Golden Predator shares. See Precipitate new release dated February 13, 2017 for additional option agreement details.
Exploration completed by Westmin Resources (1996-97), Rimfire (1998), Strategic Metals (2010) and Precipitate (2011-12) has established an extensive gold-arsenic-antimony soil anomaly measuring at least 3 km long; with gold values exceeding 1,000 ppb.
During the 2011-12 field seasons, Precipitate completed airborne magnetics and radiometric surveys, 3D inversion modeling of the magnetic data, and multiple phases of rock-silt-soil geochemical sampling and geological mapping and prospecting. This work has given technical staff a better understanding and appreciation of the structural and lithologic controls on the gold mineralization. In late 2012, work focused on the priority Fer Zone, where detailed geological mapping and rock sampling, additional soil sampling and prospecting on extensions of the South and Northeast soil anomalies and also extended new coverage over the Camp Cirque area was completed. Interpretation these geochemical and geological results indicates that future work should focus on the overlapping gold-arsenic anomalies of the Camp Cirque and Northeast areas. Additional exploration work will be needed to develop high merit drill targets. In preparation for a possible future drill program, the Company has the necessary permits and studies in-place. These include a five-year Class 3 Mining Land Use Permit from the Yukon Environmental and Socio-economic Assessment Board (dated April 2012), a property-wide desktop Heritage Resources Overview Assessment (HROA) and a preliminary field archaeological reconnaissance report for preferred roadside camp locations.
Location, Infrastructure & Access
The Reef Property is located in the southeastern Yukon, about 200 kilometers north of Watson Lake. The property covers an area of 8,615 hectares and is comprised of 418 claims owned by or under option to Precipitate Gold. Reef is accessible via the Nahanni Range Road (Highway #10) that provides access to the Cantung tungsten mine located about 20 kilometers east of the project. The claims are both road and helicopter accessible, plus chartered fixed wing aircraft can land on the Hyland airstrip located 50 kilometers south.
Geological Setting and Mineralization
Reef is located at the southeast end of the Tombstone Gold Belt within sedimentary rocks of the lower Selwyn Basin. Reef claims are underlain by Neoproterozoic to middle Cambrian aged Hyland Group sedimentary rocks composed primarily of siliclastic lithologies, with sections of calcareous sandstone and limestone. Reef is positioned in the northern portion of the Upper Hyland Gold Trend; a +50 kilometre long region of gold mineralization, which includes a number of other reputable gold occurrences, such as the Hy, 3 Ace, Sprogge and Justin. Discovered in the late 1990s, Upper Hyland Gold Trend mineralization is dominantly found within favourable sedimentary host rocks which have undergone extensive regional structural modification ("Little Owls Anticlinorium") creating favourable zones of dilation or fluid pathways. Distal or deep buried intrusive bodies are possible sources of the Trend's gold mineralizing fluids. Gold typically is found in zones of quartz veining and extensive silica flooding and is associated with variable but generally low amounts of pyrite, arsenopyrite and trace amounts of other base metals.
Exploration completed by Westmin Resources (1996-97), Rimfire (1998), Strategic Metals (2010) and Precipitate (2011-12) has established an extensive and open ended gold-arsenic-antimony soil anomaly measuring at least 3 km long; with gold values exceeding 1,000 ppb. In 1996, Westmin collected rock chip samples over an 8.0 metre long interval that returned 1.97 ppm gold.