PREMIER GOLD MINES LIMITED (“Premier”) (TSX:PG) is pleased to announce that it has signed a Letter of Intent (LOI) with the North Caribou Lake First Nation that paves the way for a major exploration program to begin immediately on the PQ North Property in Northwestern Ontario. The PQ North Property is strategically located on the PQ limb of the key iron formation that is host to Goldcorp’s Musselwhite Gold Mine.
The North Caribou Lake First Nation (NCLFN) is broadly defined as including the community of Weagamow Lake, Chief and Council, trappers and the traditional territory. The LOI forms the basis of a cooperative relationship between Premier and NCLFN that will guide the early phase of exploration on the property, including line cutting, geophysics and diamond drilling, as well as lead to a Memorandum of Understanding (MOU) in the near future. Key aspects of the LOI include:
- Contributions by Premier to the Community of Weagamow during each calendar year that exploration is active at PQ North.
- Premier will seek individuals from the Community for employment in its exploration programs.
- The employment of a Liaison and Environmental Communications person from the Community.
- A commitment by Premier to utilize goods and services from the Community.
Premier confirms that the agreement with NCLFN is the culmination of several months of ongoing discussion and relationship-building. “We regard Northwestern Ontario as our home turf and recognize that being successful here, or anywhere else, requires developing strong long term relationships with all parties having a vested interest in the region” commented Ewan Downie, Premier’s President and CEO. “This LOI marks a milestone achievement for Premier with respect to its goal of working closely with local communities that might be positively affected by mine development” he added. “The PQ North Property comprises a second strategic land position that Premier holds immediately adjacent to Goldcorp’s major North American gold mines. Based on previous drilling and surface exploration, the PQ Property is believed to have excellent potential to host gold zones similar to those being mined at Musselwhite”.
The PQ North Property encompasses a major fold structure along strike from and within the main rock unit (Northern Banded Iron Formation) that hosts the gold-bearing ore zones at Musselwhite. Previous drilling has returned several significant intersections and has identified structural units similar to those at the mine (See Figure 1). Of particular interest are a series of quartz veins, in places tens of meters wide, hosted within volcanic rocks in the southern portion of the PQ North Property. It is believed that these (low-grade) veins could be related to structures that may cut the main iron formation unit at depth, and potentially become significant gold-bearing zones. Similar veins on surface on the Musselwhite Property are located up-dip from the main gold zones currently being mined. To date, the Musselwhite Mine has produced more than 2.0 million ounces of gold and has reserves and resources totalling in excess of 3.30 Million ounces at the end of 2007.
Recently, Goldcorp has indicated that gold mineralization within the mine horizon is estimated to have increased from 1.0 million to 2.0 million ounces per kilometre as far as 6 kilometres north along strike of the main mine facilities. Results include a drill intercept of 15.5 grams per tonne (gpt) gold across a true width of 4.5 metres (m) in hole 07-NSD-005. Premier’s PQ North property is located in close proximity to, and along strike from this drilling..
Premier holds the right to earn a 100% interest in the PQ North Property subject to a 2% Net Smelter Returns Royalty of which Premier retains the right to acquire 1% by paying to the vendor $1 Million.
Figure 1 Location of PQ North Property, Musselwhite Mine and significant exploration results.
Stephen McGibbon, P. Geo., is the Qualified Person for the information contained in this press release and is a Qualified Person within the meaning of National Instrument 43-101.
Premier Gold Mines Limited is a fully financed Canadian-based mineral exploration and development company with several projects and deposits in Northwestern Ontario and a joint venture in Mexico. In the Red Lake gold mining camp, two of these are operated in joint venture with Red Lake Gold Mines. A strategic project is also located on the main Musselwhite Gold Mine trend.