Stratabound Minerals

The Calgary-based company is sitting with a 210,000-ton zinc-lead- silver deposit near Bathurst, N.B., which, President Stan Stricker says, could be mined as soon as a custom milling contract is signed.

As reserves outlined so far are in two near-surface lenses, almost no pre-development money is needed and ore could be shipped quite easily to any one of three mills in the area. The company has spent $350,000 on drilling since the property was acquired two years ago.

If the combined lead-zinc cutoff is 6%, probable reserves to a depth of 130 ft are estimated to be 190,000 tons averaging 7.59% zinc, 2.98% lead, and 2.92 oz silver per ton.

Having obtained the necessary environmental permits, Stratabound is talking with representatives of Noranda Minerals in the hope that a 12,000-ton bulk sample can be processed at the Health Steel mill, 20 km away.

All of this indicates to Stricker that he made the right decision when he elected after the October 1987 market crash to seek base metal reserves in the Bathurst area when others were looking for gold.

In less than two years, Stratabound has acquired rights to 3,706 acres in the Bathurst area, which contain the wholly owned Captain, Taylor Brook and CNE properties. All of them are subject to a 1% net smelter royalty.

“We are in a unique situation in that we have a close-to-surface deposit that is also close to a mill,” said exploration Vice-president Ken Whaley. He was referring to a southwest plunging, almost unweathered massive sulphide deposit that Whaley describes as a fluke of nature.

“Our feeling is that we can develop 500,000 tons above the 130 ft level at CNE,” said Stricker, who recently gave the green light to a 20-hole pro gram designed to expand the property’s open pit tonnage. At least two of those holes will test the deposit at depth.

According to the 43-year-old former Cominco Ltd. (TSE) geologist, Stratabound would have been able to finance that program without going to the market if East West Caribou Mining had not run into financial problems relating to its New Brunswick mine.

Until the takeover, East West was a privately owned subsidiary of Australia-based East West Minerals N.L.

Originally, Stricker had hoped to have the CNE bulk sample processed at East West’s Caribou mill west of Bathurst before using the resulting revenues to finance the next phase of exploration at the CNE deposit.

Instead, Stratabound recently announced a flow-through issue of 200,000 shares at $2 per share designed to raise the $400,000 needed to cover bulk sampling and fall drilling costs.

While the program will tell Stricker and Whaley more about the nature of the deposit, metallurgical testing of a CNE ore sample should indicate what kind of net smelter return they can expect if and when production commences. Testing is being done at Brunswick Mining and Smelting’s laboratories southwest of Bathurst.

At a rate of 500 tons-per-day, Whaley expects mining costs to be around $15 per ton. The cost of shipping ore to the Heath Steel mill, if a contract is signed, should add about $3 to that amount, according to Whaley.

Meanwhile, the Calgary company is upgrading a 15 km pulp wood haulage road that connects the CNE property to the main highway.

Stratabound is also looking for a joint venture partner to help finance exploration at the Captain and Taylor Brook properties. The CNE represents a north extension of the Captain property where a reserve estimate of 197,220 tons grading 1.12% copper (including 48,939 tons of 0.05 oz gold) is based on drilling completed by previous operators.

At Taylor Brook, five miles further west, grab sample material has assayed up to 7.1% combined lead/zinc and 3.65 oz silver per ton.

Stratabound has 3.2 million shares outstanding. At presstime they were trading at $1.60 on the Alberta Stock Exchange.

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