Nxgold (NXN-V) a company founded by management of uranium explorer NexGen Energy (NXE-T) is preparing to explore for structurally-hosted gold mineralization at its Kuulu project, located along the same geological trend in Nunavut as Agnico Eagle Mines (AEM-T) 3.4 million oz. gold Meliadine project.
The company plans to conduct a 4,000-metre, 30-hole drill program to probe beneath a number of newly discovered gold-rich quartz float at surface, along with testing magnetic geophysical anomalies that occur across the 41.7 sq. km property.
Property-wide geophysics, including a slow flying drone magnetic survey, and additional reconnaissance work, will also be conducted as part of the program.
Christopher McFadden, the company’s president, CEO, and co-founder of NexGen, interview that Kuulu was the perfect project to revitalize an idle exploration shell that NexGen had in its coffers.
“Through the work that NexGen has been doing, and the success we’ve had at Arrow, we’ve attracted quite the following in the market,” he says. “One of the transactions NexGen did came with a shell company, and it was basically sitting in the portfolio looking for something to do. So when Kuulu was presented to us as an opportunity, we decided it was a great way to revitalize that shell.”
The property is cut in half by a large fault called Dickson-Pyke. The fault separates a folded package of volcanic and meta-sedimentary rocks in the east, called the “Eastern Fold Structure,” or EFS, from metamorphosed intrusives and granitic rocks in the west, grouped together as the “Western Magnetic Linears,” or WML.
Exploration work in 2015 and 2016 narrowed down the potential source of quartz-rich boulders and float material in the EFS to three broad areas: Hinge, RB and GD. Nine of the 20 angular quartz vein float samples collected in these zones assayed greater than 1 gram gold per tonne, with local highs of 16.8 and 38 grams gold.
In the WML, magnetic lineaments vary in length from 1 to 4 km, and correlate to broad halos of gold-rich boulders at surface. Fifteen of the 51 angular quartz float rock samples collected from these zones returned greater than 1 gram gold, with highs of 27, 65, and 451 grams gold.
“The success that Agnico has enjoyed at Meliadine is what makes this project very exciting,” McFadden says. “It’s located right next door to their project, and only 40 km from Rankin Inlet, so from a geological and an infrastructure perspective, it’s very well located.”
Under an agreement signed with a private company, Meliadine Gold, in October last year, NxGold can earn a 50% interest in the property by spending $10 million over three years, and up to a 70% interest by spending an aggregate of $25 million, along with the delivery of a bankable feasibility study.
McFadden says NxGold is well funded to undertake exploration this year. The company completed a $4.9 million financing in January, which issued 19.8 million units at 25¢ per unit. Each unit consists of one share, and one-half warrant exercisable within three years at 50¢ per warrant.
“NxGold is a separate entity from NexGen, but it has the same DNA in terms of how it operates and undertakes exploration,” he says.
A portion of the capital from the financing will be used to begin work on NxGold’s most recent acquisition, the Chicobi gold project, which it acquired from private company Kenorland Minerals in April.
The property covers 600 sq. km in Quebec’s portion of the prolific 170 million oz. gold Abitibi region, and encompasses a 70 km strike length of a deformation zone that’s been largely untouched by explorers.
“Companies tend to go for the low-hanging fruit first, and Chicobi doesn’t have any,” McFadden says. “There’s no outcropping mineralization that can be seen, it’s just forests and swamps.
“All the easy stuff in the Abitibi has been found and now we have to look a bit harder and perhaps challenge some of the models and processes that have been used in that area in the past,” he adds. “We’re hoping to bring a fresh pair of eyes into the region.”
The company has 37 million shares outstanding for a $16.7-million market capitalization. |
