White Metal Resources Corp. [WHM-TSXV] said Wednesday December 18 that it has entered into an option agreement with Sokoman Iron Corp. [SIC-TSXV] to acquire by option a 100% stake in the Startrek gold property in central Newfoundland.
White Metal said the Startrek property has seen limited exploration work to date. However, it said 50 gold occurrences have been discovered on the property through previous trenching and grab samples. Previous operators, including Sokoman and Rubicon Minerals Corp. [RMX-TSX; RBYCF-OTC], have performed mechanical trenching and drilling, but many gold targets remain to be tested.
Under the option agreement, White Metal will issue to Sokoman 2 million shares (in batches of 500,000) by December 18, 2021.
The Startrek gold property is subject to a 2% net smelter return royalty in favour of the original owner; and, a 1% net smelter return royalty in favour of Sokoman, one-half of which can be purchased by White Metal for $500,000.
In addition, White Metal said it is planning to proceed with a proposed financing of up to $300,000 at $0.05 per unit. Each unit will consist of one flow-through common share plus one warrant. Each warrant is exercisable at $0.15, enabling the owner to acquire a common share for a period of 24 months.
Sokoman helped to stoke the gold fever in central Newfoundland with a discovery on its Moosehead property that sparked a staking rush that has attracted other companies into the region, including RJK Explorations Ltd. [RJX.A-TSXV; RJKAF-OTC], Pivit Exploration Inc. [PIVT-CSE; P11-Frankfurt].
Prospector Shawn Ryan’s private company Wildwood Exploration Inc. optioned 119,000 hectares in Newfoundland to Torq Resources Inc. [TORQ-TSXV]. However, in an October 23, 2018 press release, Torq said it has relinquished the property options to pursue other opportunities. In an email to Resource World, Ryan said some of those claims will be dropped. Others will be followed up on during the 2019 field season.
White Metal shares rallied recently after the company released a report on its initial due diligence grab sampling from its recently optioned Little Joanna gold property in Central Newfoundland.
The company said a total of seven grab samples, all with anomalous gold (+40 ppb gold) were collected from quartz bearing sedimentary rocks, and range from 40 ppb gold to 229.3 g/t gold, averaging 48.5 g/t gold. The highest grade sample (229.3 g/t gold) contained visible gold and was collected from subcrop near the main showing, whereas the next two highest grade samples (38.7 g/t and 70 g/t gold) were collected from outcrop of quartz being sedimentary rocks.
The little Joanna property covers 280 claim units, or 7,000 hectares and is located about 25 kilometres northeast of the town of Glenwood. It is also 45 kilometres northeast of Sokomon Iron Corp.’s [SIC-TSXV] Moosehead gold project, where the discovery hole recently returned 44.96 g/t gold over 11.90 metres from 109.000 to 120.90 metres.
In an October 23, 2018 press release, White Metal said it been granted to option to earn a 100% interest in the Little Joanna property. To exercise the option, the company agreed to make $170,000 in cash payments and issue 1.8 million shares to the optionor, who will retain a 2% net smelter return royalty interest. However, White Metal can purchase 1% for $1 million, and retains the right of first refusal to acquire the remaining 1%.
The Little Joanna gold property is a new high-grade gold discovery in an area where there has been little known exploration. The main Little Joanna showing is a 25 to 31 centimetre wide compact quartz vein within a highly altered, carbonated sedimentary melange of shale, conglomerate and siltstone.
On Wednesday, White Metal shares were unchanged at $0.04. The stock is currently trading in a 52-week range of $0.04 and 24.5 cents.