West Vancouver, British Columbia – August 7, 2018 – Magnum Goldcorp Inc. (the “Company” or “Magnum Goldcorp”) is pleased to announce results from a magnetic survey (see News Release dated May 28, 2018) completed on its “LH” gold exploration property (the “LH Property”). The LH Property consists of 19 contiguous crown granted claims and six mineral claims located approximately 7 km south of Silverton, British Columbia, on the east side of Slocan Lake. Access to the LH Property is via Highway 6 for 1.1 km south of Silverton and then via Red Mountain Road for 1.6 km to the Hewitt Mine Road, then along a four-wheel drive road along Fingland Creek for approximately 5 km.
As part of its 2018 Phase I exploration program, the Company completed an airborne magnetic survey by drone to further evaluate a pyrrhotite-enriched, gold-bearing system exposed in the LH Underground workings in the upper Fingland Creek basin. The survey comprised initial acquisition of an orthophoto to determine a digital surface model (“DSM”) with which to plan and execute the subsequent magnetic survey. The previous 2017 ground magnetic survey was hindered by local, steep topography which prevented collection of critical data over the middle portion of the LH Underground workings, along Lines 7 and 8. In contrast, the airborne drone survey returned continuous magnetic data, with stations every 1.4 cm and a line spacing of 25 m, flown at a consistent elevation of 25 m above the DSM.
In addition to collection of magnetic data, the airborne drone survey collected 378 digital images subsequently processed to provide a georeferenced orthophoto for the northern portion of the upper Fingland Creek basin. In addition to serving as a resource for planning and executing the magnetic survey, the resulting orthophoto is expected to prove invaluable in future programs for determining ground locations with more confidence and facilitating interpretations based on those locations.
The drone magnetic survey was flown using a unique system collecting 1000 readings per second (1000hz) x 2 sensors, or 2000 readings per second, with 2 readings every 1.4 centimetres along grid lines (when flying at 50km/hr). This resulted in a high resolution magnetic survey, with continuous measurements along each flight line.
A Second Vertical Derivative (“2 VD”) map of the survey area clearly defines the magnetic anomaly associated with the LH Underground workings, interpreted to be sourced from a structurally controlled, pyrrhotite-enriched (and therefore magnetic), high grade gold-bearing system. East of Line 6 (on the 2017 Ground Survey) and the spatially associated Level 1 Portal, the system has a vein-style character, whereas to the west it is characterized by a diffuse, alteration halo-style signature. This transition was interpreted subsequent to the 2017 drill program, on the basis of both the differing nature of pyrrhotite in core and moderate grade quantitative gold results and confirmed by the 2018 survey results.
This transition is clearly evident on the 2 VD map and is consistent with the results of the 2015 and 2017 drill programs. The magnetic anomaly defined by the drone survey extends from the Level 1 Portal east for approximately 180 m. Subtle variations in the intensity of the magnetic anomaly are interpreted to document small-scale, local faults resulting in minor off-sets and/or rotations (in plan view) between fault-bounded segments.
There is qualitative correlation interpreted between pyrrhotite content and gold grades, with pyrrhotite-rich intercepts correlated to high grade gold. Therefore, massive pyrrhotite is believed to be correlated with higher grade gold relative to semi-massive to web-style to disseminated pyrrhotite. Therefore, segments along the magnetic anomaly associated with the LH Underground workings having a high intensity magnetic signature are expected to return high-grade gold results. By analogy, relatively lower intensity magnetic signatures are expected to have relatively lower grade gold results. For context, two segments of the magnetic anomaly have higher intensity signatures than that portion of the anomaly associated with the 2015 drill program. The entirety of the magnetic anomaly has a signature with greater magnetic intensity than that portion of the anomaly spatially associated with the 2017 drill program. Therefore, based on these qualitative observations, the Company anticipates very encouraging results from subsequent sub-surface drilling farther east along the magnetic anomaly.
A diamond drill program is proposed in late August to early September to further evaluate sub-surface, high-grade gold mineralization previously identified, associated with the underground workings of the LH Mine (see the Company’s news releases dated August 18, 2015 and February 8, 2018). Previous drill results have been interpreted to indicate strong magnetic anomalies are associated with pyrrhotite-hosted, high grade, gold-bearing mineralization. The proposed drill program will consist of two relatively short diamond drill holes (totalling approximately 225 m) from the 2017 drill pad (the Company was unable to complete these key holes in 2017 due to late receipt of the required Mines Act permit and the onset of winter conditions). Specifically, the intent is to drill a vertical fan of two holes toward the 2015 drill pad from which multiple intervals of high grade, gold-bearing intercepts were documented. The holes are expected to confirm both the presence and true thickness of one, or more, mineralized intervals intersected in 2015, interpreted to be located at a transition from vein-style (i.e. structurally controlled), high grade, gold-bearing mineralization to moderate grade, diffuse alteration halo-style mineralization.
Phase II drilling is intended to follow Phase I, dependent upon confirmation of high grade, gold-bearing mineralization in the Phase I drill holes. Approximately 1,000 m of BTW drilling is proposed from 1 or 2 new drill pads to be constructed approximately 40 m and 100 m east of the 2017 pad, on the north side of the LH mineralized structure. A series of relatively short holes (each between approximately 100 – 150 m) will be drilled in a series of vertical fans and are anticipated to comprise preliminary delineation of the mineralized zone with which to prepare an initial resource estimate. Similar to the 2017 drill program, the proposed drill holes will be oriented at a high angle to the vein system, allowing more confident determination of the true width of mineralized intervals.
The mineralized system is interpreted to strike essentially east-west and dip steeply to the north. Sub-surface drill hole intercepts correlate well with historical mineralized samples reported from mineralization exposed in Level 1 and are interpreted to define a vein-style system which extends to depth just south of Level 3 (the lowest level of development in the LH underground workings). The 2018 program is expected to better define the structurally controlled, mineralized system, both along strike and to depth.
The 2018 survey also delineated several additional magnetic targets of interest. Three are in the vicinity of the LH Underground workings (and spatially associated magnetic anomaly) and comprise irregular high magnetic intensity anomalies interpreted to be structurally controlled. The composite anomalies are comprised of two preferred orientations, one oriented at approximately 075° and a second at approximately 025º.
The fourth high intensity magnetic anomaly is located at the northern end of the Ridge Zone (see News Release dated January 12, 2015), and coincides with both magnetic and Induced Potential survey anomalies identified by the 2014 ground geophysical survey. Furthermore, the anomaly coincides with the northern end of an extensive alteration zone, the Ridge Zone, identified independently by a previous operator.
These newly identified magnetic anomalies are of great interest to the Company and will be the focus of future exploration efforts.
This news release has been reviewed and approved by Rick Walker, P. Geo., who is acting as the Company’s Qualified Person for the LH Property project, in accordance with regulations under NI 43-101.
For further information, contact Mr. Clive Shallow, Shareholder Communications, at 604-922 2030.
Magnum Goldcorp Inc.
“Douglas L. Mason”
Douglas L. Mason, Chief Executive Officer
Neither the TSX Venture Exchange nor its Regulation Services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release
This news release includes certain statements that may be deemed “forward-looking statements” within the meaning of applicable securities legislation. All statements, other than statements of historical facts, that address such matters as future exploration, drilling, exploration activities, potential mineralization and resources and events or developments that the Company expects, are forward looking statements and, as such, are subject to risks, uncertainties and other factors of which are beyond the reasonable control of the Company. Such statements are not guarantees of future performance and actual results or developments may differ materially from those expressed in, or implied by, this forward-looking information. Factors that could cause actual results to differ materially from those in forward-looking statements include such matters as market prices, exploitation and exploration results, continued availability of capital and financing, and general economic, market or business conditions. Any forward-looking statements are expressly qualified in their entirety by this cautionary statement. The information contained herein is stated as of the current date and subject to change after that date and the Company does not undertake any obligation to update publicly or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.