Teck funding gives Lysander cash for copper-gold prospect

Junior Lysander Gold (VSE) is planning to use the proceeds of a private placement by Teck (TSE) for ongoing exploration of the Cat Mountain project where widespread copper-gold mineralization was found by trenching and drilling last year.

The Cat Mountain project, made up of the Cat and Bet claims, is 150 km north of and in a geological setting similar to the bulk tonnage Mt. Milligan gold-copper deposit being delineated by Continental Gold near Prince George, B.C.

As operator, Lysander is earning a 50% interest in the Cat claims from a unit of BP Canada (TSE) which also has an interest (30%) in Mt. Milligan. Lysander is earning a 100% interest in the Bet claims and 100% of additional claims to the north of Cat Mountain from other parties.

Upon completion of the private placement, Teck will hold 9.6% of Lysander. This would be increased to 13.7% should Teck elect to exercise all share purchase warrants. The major company has indicated to Lysander that it has no present intention to acquire further shares.

But Teck has secured a right of first refusal for any future equity financing by Lysander to raise funds for further work on these properties. In return, the major agreed to back current management for election to Lysander’s board for a period of three years.

A $1.2-million joint venture program is planned for the Cat Mountain project in 1990. The work will include extensive geophysical and geochemical surveys, additional trenching of mineralized areas, followed by substantial drilling.

Last year’s program located large geophysical targets that yielded long intervals of copper-gold mineralization from both surface trenching and initial drilling.

The results from the trenching contained many higher-grade copper intervals, including: 97 ft. of 1.64% copper and 0.02 oz. gold; 182 ft. of 0.72% copper and trace gold; 50 ft. of 1.50% copper and trace gold; 77 ft. of 0.76% copper and 0.01 oz. gold; and 38 ft. of 1.18% copper and 0.02 oz. gold per ton.

The assays results (atomic absorption) from several holes drilled in the 1989 program revealed lower grades for copper than from the trenching. The company notes this was largely the result of poor core recovery from the soft mineralized sections. Future holes will be drilled with mud to improve the percentage of core recovered in the important mineralized zones.

Results include: 117 ft. of 0.18% copper and 0.042 oz. gold; 98 ft. of 0.20% copper and 0.015 oz. gold; 85.3 ft. of 0.15% copper and trace gold; and 39.4 ft. of 0.31% copper and trace gold.

Lysander said several of the holes stopped in mineralization and would warrant deepening to test the thickness of the copper-gold formation.