Northern Shield Resources Inc. [NRN-TSXV; N9S-FSE] on Thursday May 31 released results of seven grab rock samples recently received from the Five Island copper-gold-cobalt property in Nova Scotia.
The company said five of the seven grab samples collected assayed between 0.23% and 0.057% cobalt and up to 0.19 g/t gold.
Investors reacted to the news by sending Northern Shield up 40% or $0.01 to 3.5 cents in early trading Thursday, on volume of 2.47 million, making it the most actively traded stock on the TSX Venture Exchange. The stock is trading in a 52-week range of 2 cents and 8.5 cents.
The company, through its wholly-owned subsidiary Seabourne Resources Inc., can earn up to an 80% interest in the Five Island property under a recently announced option agreement. The property is adjacent to claim groups that the company recently acquired through map staking and the two are being explored for iron-oxide-copper-gold type mineralization.
The company said mineralization is hosted in highly-sheared, bleached, brecciated and veined basalt, located at the margin of a granitic intrusion.
The basalt shows multiple phases of alteration and deformation. All of the seven samples (reported on Thursday) were collected within about a 25-metre radius of each other. “Most of the rock samples collected were likely sub-crop though at least one appears to be the top of the bedrock,” the company said in a press release.
The company went on to say that a stream sediment analysed by the Nova Scotia Department of Natural Resources assaying 650 ppm cobalt [0.07% cobalt] occurs 700 metres west of the cobalt showing, suggesting a possible continuity of mineralization along the contact from the cobalt discovery to the stream that hosts the anomalous sediment sample.
Further reconnaissance of the property will commence next week.
“We are encouraged by the potential of this style of mineralization on the Five Island Property that has not been effectively explored previously as indicated by our early successful results,” said Northern Shield President and CEO Ian Bliss. “We will focus work on a series of secondary structures whose interaction with the granite seems to influence the mineralization by creating dilatant zones that are then exploited by mineral-bearing fluids,” Bliss explained.
Under the terms of the option agreement, Northern Shield can earn a 50% stake in the Five Island property by spending $500,000 within two years. The option deal also includes a $50,000 cash payment and the issuance of 700,000 shares to the vending prospector.
Over an additional two-year period, Northern Shield can increase its stake to 80% by spending another $1.5 million, making a cash payment of $50,000 and issuing 500,000 shares to the vending prospector. The prospector will retain a 1% net smelter royalty, half of which can be reacquired by Northern Shield for $1 million.
Seaborne is also conducting exploration on the Shot Rock property in Nova Scotia after signing an option agreement with a local prospector to earn an 80% interest in the project. A first batch of stream sediment and rock samples have recently been shipped for analysis. Shot Rock is being explored for epithermal-style gold mineralization likely related to the Cobequid-Chabucto Fault, which links the two properties.
Northern Shield has also been exploring its Huckleberry copper-nickel-PGM prospect in the southern Labrador Trough.