By Peter Kennedy
When Bonterra Resources Inc. [BTR-TSXV; BONXF-OTC; 9BR1-FSE] recently snapped up Metanor Resources Inc. in a $78 million deal, the plan was to create a new gold exploration and development company with a focus on Quebec’s Urban Barry mining camp.
By attaining control of three advanced high-grade gold deposits (Gladiator, Moroy and Barry) and the only permitted gold mill in the region, Bonterra believed it was placing the combined company in an excellent position to rapidly and cost-effectively become a significant Quebec-based gold producer.
Now that the deal is complete, Bonterra said it intends to accelerate the Gladiator, Moroy and Barry deposits while expanding the capacity of the Urban Barry mill. (The Moroy deposit is located on the property that also contains the Urban Barry mill).
In press release on October 10, 2018, Bonterra said it plans to increase the capacity of the mill from 800 tonnes per day (tpd) to 2,400 tpd. Construction related to the mill expansion is expected to be completed in 2019, allowing a shortened timeline to production for the three gold deposits. The budget for this project is US$13 million.
Prior to the Metanor acquisition, the 100%-owned Gladiator Project was among Bonterra’s flagship assets.
Since commencing exploration at Gladiator in 2015, Bonterra has transformed a property with a small, high-grade gold deposit (273,000 inferred ounces grading 9.37 g/t) into a significant high-grade gold discovery, with a clear potential for a multi-million ounce, high-grade mining operation.
The company said it will release an update on the mineral resource estimate for the Gladiator deposit in the next few weeks. The company is also initiating permitting in order to develop a decline and complete a bulk sample within the next 12 months.
Optimism is based on the discovery of a new high-grade gold zone located 200 metres to the north of the Gladiator deposit. The existence of this zone was signalled with an intersection of 27.5 g/t gold over 7.0 metres at a depth of under 100 metres. The high-grade intersection occurs on wholly-owned Gladiator ground.
However, Bonterra gained room to manoeuvre by obtaining an option to acquire a 70% interest in 81 strategic mineral claims covering 3,580 hectares known as the Duke property.
Bonterra secured the Duke option by agreeing to issue 4 million shares to Beaufield Resources Inc. [BFD-TXV], paying $750,000 in cash and committing to spend $4.5 million on exploration on the property over three years. Beaufield recently agreed to be acquired by Osisko Mining Inc. [OSK-TSX].
The Duke property is an assemblage of contiguous mineral claims located immediately adjacent to the northern boundaries of the property that contains the Gladiator deposit. Bonterra said the option deal allows for larger step-out drilling on the deposit.
Meanwhile, Bonterra said the Barry deposit is permitted for initial mine development access and bulk sampling, with decline and cross cut development currently under way. Between 2008 and 2010, 43,970 ounces of gold was extracted from three small pits at the Barry deposit. Recent drilling has resulted in the expansion of the high-grade areas down plunge at each known strike extent, the company has said.
Bonterra said it expects to rapidly increase the size of the Barry deposit, especially at depth, given that very little drilling has previously taken place below 300 metres over a 1-km strike length. An updated mineral resource estimate is expected to be released in the fourth quarter of 2018.
The Moroy deposit is a recent discovery at the Urban Barry Mill property. On Bonterra’s website, it is referred to as a south-parallel system to the former Bachelor Lake Mine. Access is gained through Bachelor Lake. Current development consists of three sub-drifts and a series of raises, accessed from the 11th level at Bachelor Lake. The company said drill information exists from surface as well as from the 11th level to a depth of approximately 2,000 feet, effectively resulting in the existence of two unmined parallel mineralized zones that have yet to be quantified.
Exploration and development continues at the Moroy deposit, with a mineral resource estimate expected by early 2019.
On Thursday October 11, Bonterra shares rose 1.4% or $0.005 to 35 cents. The 52-week range is 72 cents and 30 cents.