The 122-claim property is 45 miles northeast of Elsa and 400 miles from Skagway, an Alaskan seaport. In 1988, three holes were drilled in the western part of a large lead-zinc-silver geochemical anomaly.
These holes intersected long sections of mineralization, the best of which assayed 5.4% lead, 3% zinc and 106.3 g silver per tonne (3 oz per ton) across 282 ft. None of the holes tested the entire width of the mineralized zone. Mineralization has been found on surface along four miles of strike.
Both Billiton and NDU feel the property has the potential for hosting a large tonnage moderate grade zinc-lead-silver deposit which could be mined by open pit methods. Drilling and other surface exploration will begin in 1990. A drill is already on site.
Billiton can earn its interest by spending $4 million on exploration before Dec 31, 1991, and paying NDU $200,000 as reimbursement of NDU’s 1988 exploration costs. On signing, Billiton will also pay $100,000 and will have to spend $1.1 million by the end of 1990.
If NDU elects not to participate in further work after Billiton earns its 50% interest, then Billiton has the right to increase its interest to 70% by paying NDU $300,000 and spending an additional $3 million on exploration.
Mineralization is found in fractures, breccias and stockwork zones within a 525-ft wide fault system striking across dolomites. Lead and zinc are in galena and sphalerite respectively, which NDU says, are metallurgically simple to process.
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