Lorraine Copper Corp. (“Lorraine Copper” or the “Company”) (TSXV: LLC) is pleased to announce the launch of the 2018 field program by Sun Metals Corp. at Lorraine Copper’s Stardust project in north-central British Columbia. The objective of the 2018 field program is to further explore and expand mineralization identified in a 2.2 kilometre corridor of polymetallic Carbonate Replacement System mineralization. Field work was initiated during the week of June 4 and an airborne VTEM / Magnetics survey is planned to begin within days. The 2018 work program will include:
Steve Robertson, Sun Metals President and CEO stated: “Sun Metals has a great opportunity to explore the Stardust system with an aggressive and strategic field program. The high-grade nature of mineralization previously intersected in the skarn, manto and vein zones of the system are testament to the strength of the mineralizing system.”
Stardust Project Details
The Stardust Project hosts a polymetallic, carbonate replacement system with a rich exploration history dating back to 1944. The Project lies in north-central British Columbia, approximately 150 km north of Fort St. James. It consists of 20 contiguous claims totaling 9,583 hectares and is owned 100% by Lorraine Copper, subject to the Option.
There are 393 exploration drill holes on the project that have revealed a 2.2 kilometre corridor hosting a large, coherent Carbonate Replacement System. Four distinct mineralization styles have been identified within the system, ranging from copper-molybdenum porphyry, copper-gold skarn, zinc-lead-silver mantos and silver-gold epithermal veins.
The Canyon Creek copper-gold skarn zone was the subject of a 2018, 43-101 compliant resource estimate published by the Company in January 2018. GeoSim Services Inc. provided the following estimate.
Stardust Project – Canyon Creek zone Mineral Resource Estimate(1):
|Resource Category||Tonnes||Copper %||Zinc %||Gold g/t||Silver g/t||% Cu Eq|
(1)The cut-off grade used in the resource estimate was 1.5% copper equivalent. Metal price assumptions for the copper equivalent calculation were $3.00/lb Cu, $1.25/lb Zn, $1,300/oz Au and $18/oz Ag. Adjustment factors to account for differences in relative metallurgical recoveries of the constituents will depend upon completion of definitive metallurgical testing. The following equation was used to calculate copper equivalence: Cu Eq = Cu + (Zn x 0.4167) + (Au x 0.6319) + (Ag x 0.0087). A cut-off grade of 1.5% Cu Equivalent represents an in-situ metal value of approximately $100/tonne which is believed to represent a reasonable break-even cost for underground mining and processing. These are not mineral reserves and no work has been completed that demonstrates economic viability at the Project.
The Option Agreement
Pursuant to the terms of the Option, Sun Metals has the right to earn a 100% ownership interest in the Project by making five staged annual instalments of 500,000 Sun Metals common shares, and annual cash payments of a total of $375,000. Sun Metals must also spend $6 million on the Project by December 31, 2021. Sun Metals is the operator of the Project during the Option and must spend $500,000 before the end of 2017 (incurred) and $1,000,000 annually thereafter until the earn-in is completed. Upon earn-in, Sun Metals will issue top-up Sun Metal shares, up to a maximum of 51,873,599 Sun Metals Shares, in order for Lorraine Copper to own a total 30% interest in Sun Metals. Lorraine Copper will also hold a 2% NSR on precious metals and a 1% NSR on base metals, each of which may be bought down by Sun Metals by one half, with payment of $1.5 million per royalty.