Exploration progress in the Red Lake camp of Ontario has encouraged Canadian Golden Dragon Resources (VSE) to enter into an agreement with Exall Resources (TSE) for a work program at the latter’s Gold Eagle property on McKenzie Island.
The Gold Eagle mine produced almost 43,000 oz. gold between 1937 and 1942, from veins and shear zones in the McKenzie Island granitic stock.
The workings reached 1,000 ft. and mineralization possibly extended as deep as 1,750 ft.
Last March, Goldcorp (TSE) announced the discovery of new gold-mineralized structures at its Arthur White mine, in the volcanic-sedimentary belt about 6 miles east of the Gold Eagle property.
The new zones were indicated by drilling from the 5,000-ft. level of the White workings.
Golden Dragon has agreed to spend a minimum of $500,000 in the first year of the agreement, and $3 million over three years, to earn a 50% working interest.
Exall will also receive direct payments in cash and Golden Dragon shares.
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