News

TORONTO, July 06, 2020 (GLOBE NEWSWIRE) -- Labrador Gold Corp. (TSX-V: LAB) (“LabGold” or the “Company”)  is pleased to announce that it has entered into an option agreement to acquire 100% of License 023940M ( the “Property”) which is strategically positioned between the Kingsway North and South claim blocks in the emerging Gander gold belt. The acquisition of the Property increases the Company’s landholdings in the district to 308 claims or approximately 77 square kilometres.

Property Highlights

• Comprises 44 claim units contiguous with Kingsway North and South (see Figure 1)
• Hosts the Cracker gold occurrence where grab samples from trenching range from 1.8 g/t Au to 61.73 g/t Au and channel samples range from <5ppb to 1.89 g/t Au (see Table 1)
• Historical soil sampling show gold concentrations in samples of <5ppb to 787 ppb (0.787 g/t Au), including 19 samples over 100 ppb (0.1 g/t Au)
• Historical till sampling in the northern portion of the Property close to the boundary with Kingsway North, show gold concentrations in samples of 0.11 g/t to 1.61 g/t and gold grain counts of 7 to 60 grains

Table 1. Highlights of historical rock sampling on the property.

Note that grab samples are select samples and are not necessarily representative of gold mineralization found on the property. Channel sample lengths are not necessarily true widths. The Company has reviewed the assay certificates in the following assessment report and is satisfied that the results are accurately reported  Source: Saunders, J. and Pollet ,F. 2003  Second year assessment report on the prospecting activity on the South Pond Property License 7155M northeastern Newfoundland area NTS 2/E2.

“Optioning this strategic Property consolidates LabGold’s land position in the Gander gold belt and adds a significant  gold occurrence to the property package. The Cracker showing is another gold occurrence associated with the Appleton Fault Zone, a crustal-scale structure that we believe to be a major control of gold in the district,” said Roger Moss, President and CEO of LabGold. “We will include the Property in our exploration plans for this summer with work expected to begin around mid-July.”

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/3af1346b-724d-4eca-bd88-e46e01d9867e

Terms of Agreement

LabGold can earn an initial 75% undivided interest as follows:

• Payment of $18,000.00 and issuing 30,000 common shares, within 5 business days of TSX Venture Exchange acceptance of the option agreement;
• Payment of $36,000, issuing 90,000 shares and undertaking $100,000 work expenditure on or before the first anniversary of the option agreement;
• Payment of $75,000 issuing 120,000 shares and undertaking $250,000 work expenditure on or before the second anniversary of the option agreement;
• Payment of $90,000, issuing 150,000 shares and undertaking $650,000 work expenditure on or before the third anniversary of the option agreement;

If the Company has exercised the 75% option and satisfied all payment requirements, the Company has the Option to acquire the remaining 25% interest as follows:                      

Payment of $240,000 and undertaking work expenditure of $1,000,000 on or before the fourth anniversary of the date of this agreement, provided that the cash payment requirement may be fulfilled by the Company at its discretion by the issuance of common shares of equal value.

If the Company exercises the 75% Option but does not exercise the 25% Option by the 4^th Anniversary, the parties will be associated in an unincorporated joint venture for the purpose of exploring and, if warranted, developing the Property (the “Joint Venture”). The terms and conditions of the Joint Venture shall be on industry standard terms and will be more fully laid out in an Option and Joint Venture Agreement.

The technical content of this news release was approved by Roger Moss Ph.D., P.Geo, President and CEO of the Company and a qualified person as defined by National Instrument 43-101.

About Labrador Gold:

Labrador Gold is a Canadian based mineral exploration company focused on the acquisition and exploration of prospective gold projects in the Americas.

In early March 2020, Labrador Gold acquired the option to earn a 100% interest in the Kingsway project in the Gander area of Newfoundland. The property is along strike to the northeast of New Found Gold’s discovery of 92.86 g/t Au over 19.0 metres on their Queensway property. (Note that mineralization hosted on adjacent or nearby properties is not necessarily indicative of mineralization hosted on the Company’s property). The two licenses comprising the Kingsway project cover approximately 16km of the Appleton fault zone which is associated with gold occurrences in the region, including the New Found Gold discovery. Historical work over the area covered by the Kingsway licenses shows evidence of gold in till, vegetation, soil, stream sediments, lake sediments and float. Infrastructure in the area is excellent located just 18km from the town of Gander with road access to the project, nearby electricity and abundant local water.

The Hopedale property covers much of the Florence Lake greenstone belt that stretches over 60 km. The belt is typical of greenstone belts around the world but has been underexplored by comparison. Initial work by Labrador Gold during 2017 show gold anomalies in soils and lake sediments over a 3 kilometre section of the northern portion of the Florence Lake greenstone belt in the vicinity of the known Thurber Dog gold showing where grab samples assayed up to 7.8g/t gold. In addition, anomalous gold in soil and lake sediment samples occur over approximately 40 kilometres along the southern section of the greenstone belt (see news release dated January 25^th 2018 for more details).

The Ashuanipi gold project is located just 35 km from the historical iron ore mining community of Schefferville, which is linked by rail to the port of Sept Iles, Quebec in the south. The claim blocks cover large lake sediment gold anomalies that, with the exception of local prospecting, have not seen a systematic modern day exploration program. Results of the 2017 reconnaissance exploration program following up the lake sediment anomalies show gold anomalies in soils and lake sediments over a 15 kilometre long by 2 to 6 kilometre wide north-south trend and over a 14 kilometre long by 2 to 4 kilometre wide east-west trend. The anomalies appear to be broadly associated with magnetic highs and do not show any correlation with specific rock types on a regional scale (see news release dated January 18^th 2018). This suggests a possible structural control on the localization of the gold anomalies. Historical work 30 km north on the Quebec side led to gold intersections of up to 2.23 grams per tonne (g/t) Au over 19.55 metres (not true width) (Source: IOS Services Geoscientifiques, 2012, Exploration and geological reconnaissance work in the Goodwood River Area, Sheffor Project, Summer Field Season 2011). Gold in both areas appears to be associated with similar rock types.

Following completion of this private placement, the Company has 85,610,451 common shares issued and outstanding and trades on the TSX Venture Exchange under the symbol LAB.

The technical content of this news release was approved by Roger Moss Ph.D., P.Geo, President and CEO of the Company and a qualified person as defined by National Instrument 43-101.

For more information please contact:             

Roger Moss, President and CEO      Tel: 416-704-8291

Or visit our website at: www.labradorgold.com

Twitter: @LabGoldCorp

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements: This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions are intended to identify forward-looking statements. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties. Many factors could cause our actual results to differ materially from the statements made, including those factors discussed in filings made by us with the Canadian securities regulatory authorities. Should one or more of these risks and uncertainties, such as actual results of current exploration programs, the general risks associated with the mining industry, the price of gold and other metals, currency and interest rate fluctuations, increased competition and general economic and market factors, occur or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements, except as required by law. Shareholders are cautioned not to put undue reliance on such forward-looking statements.

Figure 1

Location of License 023940M between Kingsway North and South Claim blocks.