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Croesus Gold - ON

Ontario Projects Update, July 2012

NEW SURFACE GOLD MINERALIZATION IDENTIFIED IN 2012

Project Highlights 

  • Large 100% owned property position covering 15 square kilometers of prospective geology located between both past and current gold producers and within the influence of the Porcupine-Destor Deformation Zone and Pipestone Fault.
  • Includes past-producing Croesus mine property, yielding some of the highest grade gold ever mined in Ontario.  Samples from historic bonanza grade gold production at the Croesus Mine held by the Royal Ontario Museum weigh 85 pounds collectively and contain 480.7 ounces of gold - EQUIVALENT TO 11,310 OUNCES PER TON!
  • Constantine drilling in 2011 identified several new zones of high grade gold mineralization and key alteration in the immediate Croesus mine environment (e.g. 18.79 g/t gold over 4.10 meters, 18.03 g/t gold over 1.24 meters, 11.87 g/t gold over 1.34 meters and 43.00 g/t gold over 0.22 meters) as well as the greater Croesus property and neighbouring Four Corners property which shares many geological similarities which classic Archean gold systems (see news release for details).  New shallow drill ready Croesus-type vein target identified.
  • Surface gold mineralization with similarities to Lake Shore Gold’s 2.1 Moz Fenn-Gib deposit (1.35  Moz indicated and 0.75 Moz inferred) has been identified at Constantine’s new Horseshoe Zone, located immediately west and adjacent to the Fenn-Gib deposit (see news release for details).  Recent drilling by Lake Shore has highlighted tremendous expansion potential for the open ended resource (e.g. 1.31 g/t over 414.0 meters), effectively doubling the potential width of the mineralization to the north, and dramatically enhancing the potential on immediately adjacent Constantine claims. 
  • Additional surface sampling of the greater Croesus property has yielded multiple plus-gram gold assays from the #2 Vein structure and an area 2.5 km further to the northwest (see news release for details).  These gold zones are located within 500 meters of the Pipestone Fault, an important structure known the control gold mineralization at several deposits in the region.
  • Extensive in-house knowledge on the property and the region.

Project Overview 

"The presence of a sizeable mineral system on our doorstep highlights the gold endowment within the immediate vicinity that, in combination with the new drill results, reinforces Constantine's conviction that the Munro-Croesus Gold Project has excellent potential for a major gold discovery. The Project is expected to figure prominently in the Company's future exploration plans and we look forward to continue building on this important asset." - Garfield MacVeigh, President & CEO

Except for a few brief option periods to publicly traded companies and prior to acquisition by Constantine, the Croesus mine property has been in private hands since its discovery in 1914.  Detailed mapping of the Croesus property in the 1970s by Constantine President Garfield MacVeigh set the stage for the current understanding of controls on the exceptionally high grade mineralization.  In 2007, Constantine acquired a 100% interest, subject to a net smelter interest, in the 22 patented mining claims and leases of the high-grade gold property, including the past-producing Croesus mine (acquisition details).  In 2008, Constantine expanded its property position in the area by optioning the neighboring Four Corners property; the Company has now earned a 100% interest in the current 63 claim unit Four Corners property, subject to a net smelter interest (acquisition details).   

The Croesus and Four Corners properties, collectively the Munro-Croesus Project, are located approximately 75 kilometers east of Timmins, Ontario along Highway 101.  The Project is situated within the west-central part of the prolific Abitibi Greenstone Belt, host to many world-class gold, VMS, and Ni-Cu-PGE deposits.  The main structural feature in the region is the Porcupine-Destor Deformation Zone that extends for approximately 200 kilometers from Destor (Quebec) to Timmins (Ontario) and has an area of influence up to 10 kilometers wide.  In the region of the Munro-Croesus Project, the Destor Porcupine Fault exhibits a large-scale flexure or bend associated with two major splays referred to as the Pipestone (or Contact) Fault and the Munro Fault.  Over 110 million ounces of gold have been produced along the Porcupine-Destor Deformation Zone. 

Lying as a jigsaw-fit between the Croesus property and the Four Corners property is the Fenn-Gib property acquired by Lake Shore Gold Corp. from Barrick Gold Corporation in 2011. Lake Shore recently announced a new 43-101 compliant resource containing 1.35 million ounces indicated and 0.75 million ounces inferred open pittable gold resource; current drilling by Lake Shore has documented tremendous expansion potential for the open ended resource (e.g. 1.13 g/t over 414.0 meters, which extends mineralization approximately 200 meters north of the current resource). The structural and geological controls on mineralization at Fenn-Gib are interpreted to project westward onto underexplored parts of the Munro-Croesus property, which is located immediately adjacent and along trend Fenn-Gib gold resource. Constantine controls several kilometers of the key structural contact (Pipestone Fault) to the west, which to date has received limited historic drilling.

The Croesus property includes the formerly producing Croesus Mine, known to have produced some of the highest grade gold ever mined in Ontario*.  The Four Corners property straddles the Munro Fault Zone, and is within the same sequence of rocks that hosts the past-producing bonanza grade Croesus Mine and the recently re-opened Holt and Holloway Mines (>2.0 million ounces gold combined past-production) located approximately 26 kilometers to the east.  The new Black Fox Mine, located 2.5 kilometers to the west, has approximately 2.6 million gold ounces in reserves and resources (0.9 Moz proven & probable, 1.15 Moz measured & indicated, 0.5 Moz inferred; source Brigus Gold website Feb. 2012).

The geological setting and alteration signature of the high grade Croesus gold vein at the Croesus property is similar to the original high grade gold vein discovery at Goldcorp's Hoyle Pond mine in Timmins that has produced over 2.5 million ounces to date and remains one of Goldcorp's higher grade operations.  Garfield MacVeigh, now President of Constantine, was responsible for the gold program that drilled the discovery hole at Hoyle Pond for Texas Gulf in 1980, which graded 34 oz/ton over 1.0 meter.  Of particular significance is the presence of so-called "gray zones", a very distinct and unusual alteration found adjacent to gold bearing veins.  The gray zones contain carbon, which may have catalyzed precipitation of gold during ore formation and be responsible for the exceptionally high grades observed at both Croesus and Hoyle Pond.  At the Croesus mine, high-grade mineralization occurs at the intersection of relatively flat lying veins with a sulphide (and carbon) rich phase of the Croesus flow.  High-grade gold is also known to occur at the contacts between flow units.

* As reported in the 60th Annual Report of the Ontario Department of Mines, Geology of Munro Township, J. Satterly Vol. LX, Part VIII, 1951.

Work by Constantine 

Initial drilling on the Croesus property in 2008 and 2009 (approx. 2,800 meters total) identified key alteration and new high grade cold veins at depth below the mine workings and across the Croesus fault.  Backhoe trenching in late 2010 focused on an area of historic pits within heavily quartz-veined and strongly iron-carbonate and fuchsite altered rocks in the northwest part of the Four Corners property. 

A 671 kilometer VTEM time domain airborne survey at 75 meter line spacing was completed in 2009 over the Munro-Croesus Project area. The survey appears to have identified fundamental structures on Croesus property that correlate with known gold mineralization. On the Four Corners property, the magnetic component of the survey outlined areas of prominent magnetite destruction in areas of ultramafic rocks with known gold showings.

Constantine completed a 7,280 meter drill program in 2011.  Near surface high-grade veins have been intersected in both the hanging wall and footwall to the main high-grade Croesus Mine vein structure, including intercepts of 18.79 g/t gold over 4.10 meters in MC11-C38 and 18.03 g/t gold over 1.24 meters in MC11-20.  These intersections highlight the potential for more high-grade Croesus type ore that was only mined historically to a depth of 40 meters and that could be accessible by a shallow (< 50 meter deep) open pit. Drilling has also outlined the 200 Zone target for more detailed exploration 175-200 meters below the Croesus Mine workings (9.56 g/t gold over 1.31 meters in MC11-17 and 12.2 g/t gold over 0.46 meters in MC08-10).  Five kilometers to the east at the Canamax Zone, wide spaced drilling has identified broad intervals of gold mineralization within a robust carbonate +/- silica+/- fuchsite alteration zone (e.g. 25.50 meters grading 0.30 g/t gold in CMX11-01 and 10.05 meters grading 0.55 g/t gold in CMX11-03A).  See news release dated September 20th, 2011 for details on each target area and a discussion of results.

Historic Croesus Mine (1914-1933) 

Famous for its bonanza grade gold production, five Croesus Mine gold specimens held by the Royal Ontario Museum weigh 85 pounds collectively and contain 480.7 ounces of gold or 11,310 ounces gold per short ton (387,771 grams per tonne).

   The Croesus Gold Story
March 2010


Click image to start video

Records for past production are reported in personal journals of prior owners and operators and the Ontario Department of Mines.  In 1915, an inclined shaft was collared on the high grade gold quartz-vein outcrop found in 1914.  The inclined shaft was 425 feet in length and reached a vertical depth of 125 feet.  The north-south striking (shallowly east dipping) high grade Croesus gold mineralization was mined from the shaft and from lateral development on the north and south sides of the shaft.  The extent of the vein to the north is limited by a geological contact and was terminated on the south side by an east-west fault.  Early production as recounted by Mr. Julius Cohen, production mining engineer at that time, consisted of both onsite milling and hand reduction of visibly high-grade vein material that was shipped directly to the Royal Canadian Mint.  About 1,000 pounds per week were shipped during 1915-1917 and the early part of 1918.  This type of production ceased when the fault was encountered.  No grade can be determined for these high-grade gold shipments.  In 1923, the owners milled some "clean up" mineralization.  Other small milling campaigns continued sporadically up to 1936 and produced gold from pillars, fault material and surface dumps.  The tailings for all these operations were subsequently trucked off-site and processed at the Pamour operation in Timmins.  The Ontario Department of Mines reports the total historical gold production from milled ore was 14,854 ounces gold from 5,333 short tons, for an average grade of 2.78 oz gold per short ton (95.3 g/tonne).  This does not include the high-grade gold ore shipped directly to the Royal Canadian Mint for processing.

Exploration Agreement with Wahgoshig First Nation 

Constantine Metal Resources Ltd. and the Wahgoshig First Nation ("Wahgoshig") have entered into an Exploration Agreement on the Company's Munro-Croesus Project property which lies within the Wahgoshig Traditional Territory. The primary purpose of the Agreement is to establish the foundation for ongoing communication with the Wahgoshig community during the exploration process while respecting their culture and heritage.

"This agreement demonstrates that First Nations and companies can work together in a positive and creative way while accommodating their respective objectives. The Company's agreement and co-operation in protecting our Native values and cultural sites is very important to us," said Chief Babin.  "The agreement also provides a commitment to negotiate a comprehensive agreement should the project move to beyond exploration."

The Wahgoshig First Nation is an Anishanaabe (Algonquin and Ojibwe) and Cree First Nation that traditionally hunted and lived in the Lake Abitibi region of Ontario and Quebec.  Nestled in a village (pop. 234) at the south shore of Lake Abitibi, Wahgoshig has entered into agreements with other mining companies, and is involved in the industry through business ventures and employment of its members while maintaining its traditional activities and stewardship of the environment.  A signing ceremony and community feast was held at Wahgoshig on February 7, 2009.

Excellent core logging and storage facilities are available at the Wahgoshig First Nation village, located approximately 11 kilometers east of the Four Corners property.  Wahgoshig partner company Abitibi 70 Exploration Services provides support personnel for exploration and drilling programs.      

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