North of 60 Mining News - The mining newspaper for Alaska and Canada's North

CTGO:OTC MARKETS

President and CEO: Brad Juneau

Chief Financial Officer: Leah Gaines

Contango ORE Inc. has forged an alliance with Royal Gold Inc., a company that promises to invest as much as US$30 million in furthering the exploration and potential development of the Tetlin gold properties situated along the Alaska Highway near the crossroads community of Tok in eastern Alaska.

Since acquiring the property in 2008, Texas-based Contango ORE has identified a number of precious and base metal targets across the 750,000-acre (303,521 hectares) Tetlin land package, including the Peak zone, a skarn deposit with a 1.2-million-ounce gold-equivalent resource.

Royal Gold can earn up to 40 percent interest in Peak Gold, a limited-liability joint venture that holds the Tetlin properties, by making the full US$30 million investment by October 2018.

Contango Ore's contribution to the JV includes 676,200 acres (273,654 hectares) of Alaska Native-owned lands leased from the Tetlin Village Council and some 83,720 acres (33,881 hectares) of State of Alaska mining claims adjacent to the Tetlin lease - a package the partners have valued at US$45.7 million.

The Peak zone, first drilled in 2012, currently boasts 6 million metric tons of indicated resources averaging 3.46 grams-per-metric-ton gold, 11 g/t silver and 0.25 percent copper for 783,115 gold-equivalent ounces.

Additionally, the skarn deposit has an inferred resource of 3.9 million metric tons averaging 2.07 g/t gold, 14.28 g/t silver, 0.23 percent copper for 332,969 gold-equivalent ounces.

In May, the Peak Gold JV began a US$5 million initial phase of 2015 exploration at Tetlin.

This 7,500-meter program was designed to identify the growth potential at Tetlin by testing outlying exploration targets at the Tars, Saddle, North Saddle and Saddle Skarn targets.

The drilling also tested expansion targets at the Peak zone.

"We expect to have a first phase of exploration to test new exploration targets, as well as a deeper test under the previously discovered Peak zone," said Contango ORE President and CEO Brad Juneau.

In September, Contango reported that the Peak Gold joint venture approved a US$4 million second phase of 2015 drilling at Tetlin.

The 6,000-meter phase 2 drilling will follow up on some of the more promising holes drilled earlier this year.

Juneau said, "While the joint venture has not received all assays back from the phase 1 drilling, initial findings are encouraging." As a result of the US$9 million invested this year, Royal Gold has earned an eight percent interest in the Peak Gold joint venture.

Cash and short-term deposits:

US$1.9 million (June 30, 2015)

Working capital: US$1.9 million

(June 30, 2015)

Market capitalization:

US$19.8 million (Sept. 24, 2015)

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