Wolfden acquires past producer (July 02, 2001)

Wolfden Resources (YWO-V) intends to buy the past-producing Argosy gold property in the revived Red Lake mining district of northwestern Ontario.

To do so, Wolfden must spend $10,000 in cash and issue 200,000 shares. The property is subject to a 2% net smelter return (NSR) royalty, half of which can be bought back for $500,000. Regulators have yet to approve the deal.

The mine operated intermittently between 1934 and 1952, during which time it produced 276,573 tons at an average grade of 0.368 oz. gold per ton, to a maximum depth of 900 ft. The three mined zones are open at depth, and the maximum depth is 900 ft.

A drill hole 120 ft. below the bottom level of workings on the No.1 vein cut 3.3 ft. grading 0.68 oz. gold.

Since 1952, the property has seen little exploration. In addition to the three mined zones, it hosts several significant veins, including No. 8, where a raise assayed 1.25 oz. gold over 2.2 ft. A surface hole was drilled to intersect the vein updip, and returned 8.6 oz. gold over 1 ft. at a depth of 60 metres.

In a separate deal, Wolfden has obtained an option from two private vendors to acquire three patented mineral claims in the Nickleby Lake area, near Thunder Bay, Ont. Wolfden has agreed to pay $785,000 and issue 175,000 shares over five years. The claims are subject to a 1.5% NSR to the vendors, 0.75% of which can be bought back at any time for $750,000.

Meanwhile, Jonpol Explorations (JON-T) has agreed to acquire a half-interest in the claims by covering half of the payments due to the vendors. Jonpol will pay Wolfden (based on Wolfden’s share price at the time of issuance) to cover the share portion of the payment to the vendors.

The partners have already begun a program of line-cutting, ground magnetics and stripping on the claims.

In another deal, Wolfden has issued, by way of private placement, 375,000 units to Northway Explorations (NOW-T) at 40 apiece. One unit consists of one Wolfden share and half a purchase warrant. Each warrant is exercisable for one share at 65 for two years. A third of the shares will be flow-through, and all shares are subject to a holding period of 18 months.

A portion of the proceeds will be used to explore Wolfden’s High Lake property in Nunavut.