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

Contango ORE Inc. June 21 announced that it has raised US$10.9 million to fund its share of exploration and development of Manh Choh, a 1.2-million-ounce gold mine project in eastern Alaska being explored and developed in partnership with Kinross Gold Corp., as well as exploration on three other gold properties wholly owned by CORE.

The financing involved the issuance of 523,809 CORE shares at US$21 each.

Alaska Future Fund, an Alaska investment program launched in 2019 by Barings and Alaska Permanent Fund Corp., invested US$10 million into the financing.

Managed by Barings, a US$325 billion financial services firm owned by Massachusetts Mutual Life Insurance Company, the Alaska Future Fund was formed to invest in projects that will benefit Alaska's development while also generating strong market-based investment returns.

"This financing represents yet another important milestone for the company," said Contango ORE President and CEO Rick Van Nieuwenhuyse. "I believe attracting two premier financial institutions, the Alaska Future Fund and Barings, demonstrates the excitement around building Alaska's next gold mine in partnership with Kinross and the Tetlin Tribe."

Also excited about Manh Choh and the exploration projects owned by CORE, Van Nieuwenhuyse contributed US$1 million to the financing.

"I am also pleased to participate personally in this financing to demonstrate my resolve to add value for our shareholders, as well as to grow long-term value for the state of Alaska and Alaskans by building an Alaska-based and focused exploration and mining company," he added.

The centerpiece of this Alaska-centric plan is the development of Manh Choh, where CORE outlined two gold deposits on a 675,000-acre land package leased from the Tetlin Alaska Native Tribe. These deposits – Peak and North Peak – host 9.2 million metric tons of measured and indicated resources averaging 4.08 grams per metric ton (1.21 million oz) gold and 14.19 g/t (4.2 million oz) silver in two adjacent deposits on the project.

With the idea of processing high-grade ore from Manh Choh in the mill at its Fort Knox Mine north of Fairbanks, Kinross paid US$93.7 million to buy a 70% joint venture interest in Manh Choh, with CORE owning the remaining 30% stake in the Peak Gold JV.

Based on the current resource, Kinross expects to produce 1 million oz of gold-equivalent, which includes the value of both the gold and silver recovered, from Peak Gold ore over a 4.5-year mine life slated to begin in 2024.

To advance this project, the Peak Gold JV budgeted US$18 million for 2021 to fund in-fill drilling, engineering, and environmental studies needed to complete a feasibility level study for a mine at the Peak Gold deposits; exploration to test other intriguing targets across the expansive Manh Choh property; as well as community relations activities in the Tetlin area.

CORE says the in-fill, metallurgical and geotechnical drilling portion of this program is complete, and the Peak Gold partners recently met to discuss and finalize targets for the exploration phase of the 2021 program. This exploration, already underway, is testing extensions of the Peak Gold deposits, as well as exploring additional potential resource areas on the property.

In addition to the work at Manh Choh, CORE is carrying out exploration on its Hona and Eagle projects, which are comprised of state mining claims adjacent to Manh Choh, and Shamrock, which is on state claims alongside the Alaska Highway about 70 miles southeast of Fairbanks.

Located about 15 miles northwest of the Peak Gold deposits, Hona hosts a gold-copper prospect originally identified and drilled by Kennecott Exploration in 1997.

Subsequent work by Alaska Division of Geological & Geophysical Surveys found evidence of intrusion-related gold or porphyry copper-gold deposits at Hona.

Rock samples collected from a 5,000-meter-long mineralized area of Hona returned assays as high as 12.5 g/t gold, 10.09% copper, and 494 g/t silver.

Two holes drilled by CORE in 2019 encountered copper-gold-silver mineralization at Hona, with one of the holes cutting 17 meters averaging 0.41 g/t gold, 5.4 g/t silver, and 0.33% copper.

Reconnaissance level stream sediment and pan sampling at Eagle, a robust but earlier staged gold target northwest of Hona, has identified a six-mile- (10 kilometers) long corridor where every creek draining the northeast slopes of the mountains are strongly anomalous in gold, arsenic, and copper. Further sampling continued along the northwest trend shows additional anomalous creeks up towards the Dome prospect, albeit far fewer streams have been sampled in this area.

Follow-up field exploration, expected to largely focus on identifying drill targets in the highly prospective area between the Eagle and Dome prospects, is being carried out this summer at this exciting early-stage project.

Contango ORE Inc.

A Google Earth image looking northeast over Contango ORE's Hona and Eagle gold projects northwest of Manh Choh.

Shamrock, the newest addition to the CORE portfolio, was staked by the company this spring.

Covering a large portion of the Richardson Mining District, the 52,920-acre Shamrock property is prospective for three types of gold deposits: gold in low angle quartz veins similar to those being mined at Northern Star Resources Ltd.'s Pogo Mine about 50 miles to the northeast; intrusive related gold deposits similar to Kinross' Fort Knox Mine about 55 miles to the northwest; and high-level rhyolite intrusive dikes with associated clay and silica alteration which occurs in the Democrat and Banner dikes area of the property.

A compilation of all previously acquired geochemical sampling, drilling and geophysical surveys carried out at Shamrock is being used to guide the 2021 exploration on the road-accessible gold exploration property.

Author Bio

Shane Lasley, Publisher

Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

• Email: [email protected]
• Phone: (907) 726-1095
• https://www.linkedin.com/in/shane-lasley-ab073b12/