Update on BTU Dixie Halo Project - Kinross (Great Bear) Option
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Update on BTU Dixie Halo Project - Kinross (Great Bear) Option
March 13, 2024, Vancouver, BC, Canada – BTU METALS CORP. (“BTU” or the “Company”)
(BTU-TSX:V BTUMF-OTC) announces updates on the exploration work completed on the Dixie Halo
Project optioned to Kinross Gold Corporation (K-TSX). Kinross holds their interests in the area in a wholly
owned subsidiary Great Bear Resources Ltd. (“GBR”). The Company’s Dixie Halo project is a strategic,
large land position adjacent to the world class Great Bear gold deposit southeast of the main Red Lake
Gold camp area in northwestern Ontario.
The Dixie Halo Project is located adjacent to Kinross’ Great Bear project (the “Great Bear Project”)
where Kinross has budgeted $85 million for 2024 for the continuing exploration and development of what
they refer to as a world class gold deposit. Kinross continues to expand the envelope of the known gold
mineralization down-dip and along strike and they have also announced plans to explore outside the known
mineralization this year. Kinross recently announced deep drill hole results on the Great Bear Project that
included an intersection of 389.57 g/t gold over a 4.4 m core length (Drill hole BR843AC1A).
Exploration Summary and Exploration Plan for 2024
A state-of-the-art airborne magnetic survey was completed in late 2023 using the same contractor
(Geotech Ltd.) and the same airborne geophysical system as was used at the Great Bear project to provide
a seamless, consistent high-quality airborne magnetic dataset to generate a solid base for updated
geophysical interpretation and geological correlation across the Great Bear and Dixie Halo projects.
Detailed interpretation of the data is ongoing.
GBR is continuing work under the Option Agreement including an ongoing program of re-logging and
sampling of all of the BTU drill core using its ever-expanding experience and geological knowledge they
have amassed in relation to the gold mineralization at the Great Bear project. GBR will use the sampling
protocols used at Great Bear to provide a more comprehensive and complete understanding of the geology
and alteration on the Dixie Halo project and to provide an expanded basis for the correlation of geological
units and alteration throughout the area.
GBR plans to complete a geological review and sampling of various outcrop areas of interest on Dixie
Halo including some of the areas worked in the past by BTU.
As the various review, relogging and sampling results are received and compiled by GBR, an initial core
drilling program will be planned and GBR expects to be in a position to execute an initial drill program
once it has secured an exploration permit from the Ontario government.
Under the option agreement GBR is required to spend not less than $2.7 million over the first three years
and a total of $4.7 million to earn a 70% interest in the Dixie Halo property. The BTU-GBR option
agreement closed on February 22, 2023.
BTU CEO Paul Wood commented; “We are very pleased to be working with Kinross and the Great
Bear project team as they carry on the exploration of the Dixie Halo project. We are excited to be involved
as they apply their expertise to continue the evaluation of the best places to explore on the Dixie Halo
project. We look forward to them defining the best available gold targets and then drill testing those
targets. The knowledge and expertise they bring to the further evaluation of the Dixie Halo project are
invaluable, given they are the experts at defining the structure, alteration and gold mineralization in the
area.”
BTU has now received the $300,000 anniversary payment from GBR under the Purchase Agreement,
bringing the Company’s cash balance to approximately $1.7M.
February 2023 transactions with GBR
The Transactions entered into by BTU and GBR, in late February 2023 included: (i) a purchase agreement
pursuant to which GBR acquired from BTU certain unpatented mining claims located in the Kenora
District of Ontario, with BTU continuing to participate in those lands through a newly created royalty
payable to BTU; (ii) an option agreement, which provides GBR with an option to earn a 70% interest in
certain unpatented mining claims held by BTU located in the Kenora District of Ontario; and (iii) a
subscription agreement pursuant to which GBR purchased 25,000,000 common shares of BTU at a
purchase price of CAD$0.05 per common share.
Asset Acquisition
The Company entered into a purchase agreement with GBR, a wholly-owned subsidiary of Kinross, for
the purchase (the “Acquisition”) of certain unpatented mining claims located in the Kenora District of
Ontario (the “Acquisition Properties”). The Acquisition Properties had a total area of 2,637 hectares and
consisted of 39 Boundary Cell Mining Claims and 76 Single Cell Mining Claims located to the south of
the Great Bear Project, as well as 2 Multi-cell Mining Claims located to the north of the Great Bear Project.
BTU holds Net Smelter Royalties from 1.5% to 2.5% on these properties as well as underlying royalty
buy back rights.
The consideration payable by GBR pursuant to the Acquisition was: (i) CAD$1,550,000 in cash, with
CAD$1,250,000 due immediately on closing and an additional CAD$300,000 due on the one-year
anniversary of the closing date (received February 2024), and (ii) GBR issued to the Company a variable
1.5% - 2.5% NSR royalty on the Acquisition Properties (the “Royalty”), such that each Acquisition
Property will have a cumulative total 4% NSR royalty attached to it upon the grant of the Royalty, once
combined with the existing royalties payable over and in respect of the Acquisition Property. BTU will
maintain any existing third-party royalty buy-back rights in respect of the Acquisition Properties.
Figure 1: Map showing the Acquisition Properties, Optioned Properties ase well as Kinross’ properties and the BTU/GoldON Pakwash
properties. The Great Bear Project mineral resource is located on the northern Kinross property on this map.
The Acquisition was an arm's length transaction pursuant to the policies of the TSX-V.
About the Option Agreement
The Company entered into a property option agreement (the “Option Agreement”) with GBR, pursuant
to which GBR has been granted the right to acquire an undivided 70% interest in and to 757 mining claims
(12 Boundary Cell Mining Claims, 3 Multi-cell Mining Claims, and 742 Single Cell Mining Claims)
covering approximately 16,410 hectares of land, located in the Kenora District of Ontario (the “Optioned
Properties”).
Pursuant to the terms of the Option Agreement, GBR has the option to acquire the 70% interest in the
Optioned Properties in consideration for completing cash payments or exploration expenditures on the
Optioned Properties, being: (i) CAD$2,700,000 in expenditures, to be incurred by GBR on or before the
date that is 36 months from the effective date of the Option Agreement, and (ii) a further CAD$2,000,000
of expenditures, to be incurred by GBR in its sole discretion within 48 months from the effective date of
the Option Agreement.
In connection with a private placement in February 2023, GBR acquired 25,000,000 Common Shares.
Pursuant to the private placement GBR held an aggregate of 25,000,000 Common Shares representing
approximately 17.5% of the current issued and outstanding common shares on a non-diluted basis of the
Company.
About BTU
BTU Metals Corp. is a junior mining exploration company focused on the Dixie Halo Project located in
Red Lake, Ontario immediately adjacent to the Great Bear Project. The Company has no debt, no property
obligations and maintains a cash balance of approximately $1.7M.
ON BEHALF OF THE BOARD
“Paul Wood”
Paul Wood, CEO, Director
BTU Metals Corp.
Telephone: 1-604-683-3995
Toll Free: 1-888-945-4770
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