Casa Berardi
In addition to the Company´s Timmins properties, it also has approximately 90 metres of strike along the Casa Berardi break in northern Quebec and northern Ontario, about 140 kilometres north of Timmins.
Included in this land package is the Casa Berardi optioned property. During the third quarter of 2007, the Company entered into a joint venture agreement with Aurizon Mines Ltd. (“Aurizon”) for the Casa Berardi optioned property which covers a 30 kilometre strike length of the Casa Berardi deformation zone. The historical exploration data has been received and a detailed compilation was conducted in the fourth quarter. A significant drilling program for the project started early in 2008.
The Casa Berardi property is located outside of Aurizon´s existing mining leases and outside of its 100%-owned Casa Berardi mine. The Casa Berardi property covers 227 claims in an east and west block surrounding the Casa Berardi mine and covers an area of 11,594 hectares along a 30 kilometre section of the Casa Berardi fault. The Casa Berardi fault is a major structural zone that is host to a number of gold and base metal deposits. Numerous gold showings occur within the Casa Berardi property, which have been subject to limited exploration since its discovery in the 1980s.
Under the terms of the agreement, Lake Shore Gold can earn an undivided 50% interest in the Casa Berardi property by incurring exploration expenditures of $5 million over a five-year period, including a firm commitment of $600,000 in the first year. Lake Shore Gold will be the operator during the earn-in period. If an indicated mineral resource of at least 500,000 ounces of gold at a minimum grade of 6.0 grams of gold per tonne (or economic equivalent thereof) is established, the area containing the resource plus a one kilometre radius surrounding the outer perimeter of the resource may be transferred to a specific property joint venture, in which Aurizon and Lake Shore Gold will each have a 50% interest. Aurizon will then have the right to earn an additional 10% interest in the specific property by funding the costs of a feasibility study. The work program started in the first quarter of 2008, with the first-year expenditure commitment of $600,000 having been met during the quarter. Initial work focused on the claim block located east of the Casa Berardi mines.
As of December 31, 2009, Lake Shore Gold had spent a total of $3.5 million on the Casa Berardi property, of which $1.7 million were spent during 2009. Exploration expenditures in Quebec result in a 40% refundable tax credit to the Company and to date, the total amount of the Company´s eligible Quebec refundable tax credits is $1.4 million, including $0.7 million in 2009.
Work completed in the twelve months ended December 31, 2009 included drilling 6,893 metres in 16 holes. Of the 16 holes, 10 holes (3,656 metres) were completed on the east block approximately 6.0 kilometres (“kms”) east of the Casa Berardi mining operations and along the east extension of the Casa Berardi fault zone. The remaining six holes and 3,237 metres were drilled on the west extension of the Casa Berardi Fault at distances between 600 metres and 1.3 kms west of the boundary with the Casa Berardi Mine.
Significant results from the East Block included CE-09-12, drilled 280 below surface to test the east portion of the “G-Zone”), which confirmed the continuity of the structure in the previously reported “new discovery” hole CW-08-03, which intersected 8.58 gpt over 10.40 metres (see press release dated October 23, 2008). CE-09-18 was drilled 400 metres west of CE-09-12 to test an intersection of 6.84 gpt over 3.10 metres in the previously released CE-08-11. This hole returned 3.04 gpt over 6.30 metres and extended mineralization in this area to a vertical depth of 290 metres within a strike length of 500 metres.
Drilling on the West Block of claims focused on exploring a 1.0 km strike length of untested stratigraphy along the Casa Berardi Fault. CW-09-23 returned 3.44 gpt over 3.91 metres, at a vertical depth of 375 metres below surface. This new intersection is the most significant result from the limited drilling west of the Casa Berardi Mine Claim boundary and highlights the exploration potential for new discoveries along the Casa Berardi Fault trend.
The 2010 drill program will include approximately 10,700 metres of diamond drilling on both the East and West blocks and includes both summer and winter drilling. Expenditures related to the 2010 program are expected to allow the Company to earn its 50% interest in the Casa Berardi operation property before the end of 2010. The winter program started by the end of February 2010 and will include a total of approximately 6,000 metres in 23 holes designed to illustrate continuity and expand mineralization in the G Zone.
| Casa Berardi | |
|---|---|
| (CE-08-03) | 8.58 Au g/t over 10.4 metres |
| Including | 13.03 Au g/t over 6.45 metres |
| Including | 51.33 Au g/t over 0.65 metres |
| (CE-08-07) | 8.64 Au g/t over 2.4 metres |
| Including | 28.82 Au g/t over 0.65 metres |
| (CE-08-11) | 6.84 Au g/t over 3.1 metres |
| Including | 13.80 Au g/t over 0.3 metres |
