Lincoln Gold Mining Inc. [LMG-TSXV; LNCLF-OTC; ZMG-FSE] said Friday April 23 that it has expanded its property portfolio by entering an option deal to acquire a 100% interest in the Shawinigan nickel-copper-cobalt property near Shawinigan, Quebec. The project is located about halfway between Montreal and Quebec City.
As the company continues to advance its Pine Grove Gold Project in Nevada, management believes this is the right time to take advantage of the many opportunities in base metal exploration and production given the current short supply of these metals that are necessary for infrastructure and emerging technologies, the company said.
The property consists of 21 contiguous mineral claims, covering 12.4 square kilometres and is close to key infrastructure, including highways, power lines and water. It was previously explored by Soquem of Quebec between 1971 and 1975. Soquem conducted five programs, including geological mapping, soil and rock sampling, mineralogical investigation, magnetometer and EM surveys.
Diamond drilling returned low to medium grade nickel/copper mineralization.
The company said past exploration has covered only a small area of the property, but had demonstrated significant potential for the discovery of nickel-copper mineralization with zinc-cobalt as by-products. All previous exploration is historical and not compliant with NI 43-101 standards of disclosure.
Further exploration will be required to establish a mineral resource or reserve, the company said.
Under the agreement, Lincoln has agreed to pay the optionor $380,000 in cash and issue 2.1 million shares in batches over five years. The junior has also agreed to spend $2 million on exploration over a five-year period.
Lincoln has agreed that if an independent technical report, prepared in a compliance with NI 43-101 standards of disclosure, confirms the existence of mineral reserves and resources on the property, it will issue another 500,000 common shares to the vendor.
Once the option is exercised, the vendor will retain a 2.0% net smelter return royalty on any metals produced on the property. However, Lincoln can buy down the royalty for 1.0% for $1.5 million.
Lincoln shares jumped 9.1% or $0.015 to 18 cents on the news and currently trades in a 52-week range of 27.5 cents and $0.08.
Lincoln Gold is an advanced-stage gold mine exploration and development company. It’s key asset is the Pine Grove gold project, which is located on the Walker Lane structural zone of western Nevada.