Queenston carves dominant position in Kirkland Lake

Queenston Mining (QMI-T, QNMNF-O) staked its claims in Canada’s second largest gold camp early and often a strategy that has given it the biggest land position in the Kirkland Lake district of northern Ontario.

With roughly 27 sq. km of land 90% of which is wholly owned Queenston is zeroing in on four deposits clustered in the Gauthier Townships in the eastern portion of the Kirkland Lake gold camp.

Its key property, however, is Upper Beaver — a former mine that turned out gold and copper from 1920 to 1972.

The company wound down a 52,000 metre drill program at the end of the second quarter and while a resource estimate is still pending it was due out in the second quarter of this year but Queenston now says it will come by the end of the third quarter highlight intersects included 16.5 metres grading 10.8 grams gold; 7.3 metres grading 145.9 grams gold; 13.3 metres grading 19.4 grams and 1.8% copper; and 13 metres grading 14.5 grams gold. All of those results come from separate holes.

With enough drilling done for the estimate Queenston has turned its attention to greater depths. The company is finishing up a drill program aimed at testing geophysical anomalies below the known Upper Beaver deposit. Seven of the planned nine holes have been drilled with assay results pending.

The deeper drilling is being complimented by metallurgical studies on ore from the upper deposit. Previously tested ore had historical recovery rates of 94% for gold and 95% for copper.

All the activity at the project is putting Queenston into a strong development position, and the company says once the resource estimate is done it will immediately begin working towards getting a prefeasibility study done.

And while the market waits for numbers on Upper Beaver it can ponder specifics at the nearby Anoki deposit.

Anoki stands as Queenston’s only deposit with a national instrument compliant resource estimate.

Measured and indicated resources stand at 522,000 tonnes grading 5.7 grams per tonne for roughly 105,000 oz. while inferred resources are at 142,000 tonnes grading 6.3 grams gold for 32,000 oz.

Anoki also benefits from past work done at the site. The project has a ramp, shaft and five levels of underground infrastructure thanks to work done by Queenston and Inco back in the mid-1990s. The companies were working towards bringing the project into production before collapsing gold prices forced them to pull back.

Roughly 500 metres north of Anoki lies the McBean deposit, a past producing open pit mine that turned out roughly 50,000 oz. of gold and has a non-compliant historical resource estimate of 835,000 tonnes grading 5.1 grams for 150,000 oz.

Queenston has been drilling the deposit this year, and plans to have a NI 43-101 resource finished by the end of the calendar year.

Together the Anoki-McBean deposits are subject to a 2% net smelter return (NSR) to Franco-Nevada Mining (FNV-T) and a 1.3% to Vale (RIO-N) after the production of 300,000 oz of gold.

Next in the order of priority for Queenston is the Upper Canada project, another past producer that turned out 1.5 million oz. from 1936 to 1972, the mine put out roughly 1.5 million oz.

Still in the ground is a historic resource of 1.9 million tonnes grading 6.9 grams gold.

Queenston plans to launch a diamond drill program at the project some time in the third quarter of this year.

In all the Kirkland Lake gold camp has a historic resources of 3 million tonnes grading 6.1 grams gold and 4.6 million tonnes grading 5.4 grams.

At the Cadillac gold camp the company has 500,000 oz. of historical resources from 3.7 million tonnes grading 4.8 grams gold.

Queenston has roughly 53 million shares outstanding and its shares have traded between $1.49 and $3.83 over the last 52 weeks.

It has roughly $11 million in cash and cash equivalents and no debt.