NuLegacy acquires 100% 
of Iceberg beside Goldrush

NuLegacy Gold (TSXV: NUG; US-OTC: NULGF) has consolidated the Iceberg gold deposit in Nevada, with plans to keep drilling the asset ahead of calculating a maiden resource estimate.

NuLegacy found the Carlin-type gold deposit in 2012, two years after signing an earn-in agreement with Barrick Gold (TSX: ABX; NYSE: ABX) on the Redhill property in the Cortez trend, where the major has three multimillion-ounce gold deposits, including the producing Pipeline and Cortez Hills deposits, and the Goldrush development project.

Under this contract, the junior had to spend US$5 million exploring the property by the end of 2015, in exchange for a 70% interest. NuLegacy fulfilled the requirement last September and waited for Barrick to decide on whether it wanted to earn back the 70% interest, or keep its 30% minority working interest.

Workers at a drill site at NuLegacy Gold’s Iceberg gold deposit in Nevada.  Credit: NuLegacy Gold

In February 2016, the gold major converted its 30% interest into 32 million NuLegacy shares, making it the company’s largest shareholder at 16.7%, helping NuLegacy consolidate its interest in March. Barrick also retained a 2% net profit interest royalty from commercial production on the property.

NuLegacy’s chair Albert Matter said he’s “delighted” about the consolidation and that it represents a “logical extension of Barrick’s renewed approach to mining and exploration.”

This approach includes Barrick refocusing on its core assets and selling its less stellar assets to lower its debt. In the case of exploration projects, the major appears happy to have a minority interest, leaving the “heavy lifting” to the junior, Matter notes.

He adds that Barrick’s geological staff is “bullish” on the Iceberg project.

On March 22, Barrick nominated Robert Krcmarov, its executive vice-president of exploration and growth, as its representative on NuLegacy’s board of directors.

In 2014, Krcmarov was the co-recipient of the Prospectors & Developers Association of Canada’s Thayer Lindsley award for international mineral discovery of the year, as he led his team to discover the 10 million oz. Goldrush deposit.

In May NuLegacy plans to kick off a 10,000-metre drill program on the Iceberg deposit, which neighbours the Goldrush project and resembles the geology found at Iceberg. The junior expects to finish the 40-hole program in five phases by late August, pending funding.

Most of the drilling will expand the deposit’s high-grade zones, primarily the North zone and the larger Central zone. With the latter having enough drill density to support the planned National Instrumental 43-101 compliant resource calculation.

Rock chips from NuLegacy Gold’s Iceberg gold project in Nevada.  Credit: NuLegacy Gold

As part of its 2016 drill program, it will explore other prospective Carlin-type gold systems on the property, including the Avocado, VIO and Jasperoid basin gold anomalies.

With a little over $1 million in its treasury, NuLegacy has enough funds to start drilling, and expects to raise $2.5 million to complete the 2016 program and maintain a healthy treasury.

It has invested US$5 million on the property and has an estimated 90- to 110-million-tonne exploration target grading 0.9 to 1.1 grams gold per tonne. These figures are conceptual and require more work.

Along with drilling, NuLegacy’s corporate goals for 2016 and beyond include increasing its brokerage coverage to help raise funds to finish the resource estimate by the end of August, and advance the project towards development in 2017.

Its goal is to capitalize on the value of Iceberg and nearby deposits by selling the assets, or merging with a gold producer.

The junior recently closed at 13¢ per share, within a 52-week trading range of 8¢ to 17¢. It has a $24.9-million market capitalization.