Hidden Lake Gold acquires large property in N.W.T.

An option to earn a 51% interest in the 40,000-acre Camsell Lake property located 115 miles northeast of Yellowknife, N.W.T., has been obtained by Hidden Lake Gold Mines (VSE) from a private claim owner.

The agreement, subject to regulatory approval, calls for Hidden Lake to spend $1 million on exploration work by Sept 5, 1993, and a further $1 million without time limit, to earn another 29%. A cash payment of $35,000 will be made by Hidden Lake upon signing. An option to purchase 100,000 Hidden Lake shares at 75 in the first year and $1 thereafter is also to be granted. The remaining 20% working interest can be bought out for $200,000 or its equivalent in Hidden Lake stock. If a 100% interest is earned, the original owner will retain a 2% net smelter return royalty.

In a related agreement, Hidden Lake Gold acquired another 4,000 acres of property in the Camsell Lake belt from Kelmet Resources of Calgary. The company must spend $25,000 on the Kelmet ground before Aug 31, 1989.

The company is acquiring the properties because it believes the Camsell Lake belt may be a southerly continuation of the Courageous lake volcanic belt which hosts the Tundra gold deposit owned by Noranda Inc. (TSE) and Getty Resources (TSE).

The Camsell Lake belt has been prospected primarily for base metals in the past. Some occurrences of gold were recorded with scattered values of up to 1.36 oz per ton in quartz veins and 0.5 oz per ton in gossan material.

Besides the Camsell Lake property, the company has several other gold properties in the Northwest Territories, and one gold project in northwestern Manitoba. Hidden Lake Gold Mines is controlled by Ardic Exploration and Development, a private company based in New York.