Banyan Gold Signs Definitive Agreements for McQuesten and Aurex Gold Properties, Yukon – Consolidating the Emerging Gold District BANYAN GOLD CORP.
Banyan Gold Signs Definitive Agreements for McQuesten and Aurex Gold Properties,
Yukon – Consolidating the Emerging Gold District
BANYAN GOLD CORP.
MAY 25, 2017 TSX-V: BYN
BANYAN GOLD CORP. (“Banyan” or the “Company”) is pleased to announce that further to its
news releases of February 28, 2017 and April 28, 2017, it has signed definitive agreements (the
“Agreements”) for options to acquire up to 100% of the Aurex property, from Victoria Gold Corp.
(“Victoria”), and up to 100% o f the McQuesten property, from Alexco Resource Corp. (“ Alexco”),
respectively.
The Aurex and McQuesten properties are contiguous properties that comprise approximately
8,230 hectares and 1,000 hectares respectively , and together represent a large Projec t highly
prospective for intrusive -related gold mineralization which includes zones of historic gold
production (lode and placer), in the prolific Mayo Mining District, Yukon Territory. The Board of
Directors of each of Banyan, Victoria and Alexco have ap proved the Agreements and are
supportive of Banyan’s involvement in the Project . The parties’ respective obligations under the
Agreements are subject to the satisfaction of certain conditions precedent, including the receipt of
all necessary approvals from the TSX Venture Exchange (the “ TSX-V”) and in the case of Alexco,
consent of Wheaton Precious Metals Corp. (formally Silver Wheaton) and the Government of
Canada.
The now combined Aurex -McQuesten property forms a contiguous claim block of approximately
9,230 hectares and affords a unique opportunity to combine , for the first time ever a substantial
amount of detailed historic exploration and evaluation data. This data compilation has already
generated a series of high -priority exploration targets within previously independently explored
project boundary.
Tara Christie, President and CEO commented, “With these Options, Banyan will be the first
company to consolidate ownership of these highly prospective intrusive-related gold properties that
have been explored for precious metals mineralization since the turn of the last century. Moreover,
the support and strategic investments from Alexco and Victoria, two of Yukon’s premier developers
underscores Banyan presence in this rapidly developing Yukon developme nt district. With these
definitive agreements now in place , combined with being well financed, Banyan is positioned to
commence a field program immediately.”
The Mayo Mining District boasts over 100 years of advanced gold and silver mineral exploration
and development, including the Historic Keno Hill Silver District (“ KHSD”), now owned and
operated by Alexco.
To the north of the combined properties, lies Victoria’s Eagle Gold Project which hosts a National
Instrument 43-101 (“NI 43-101”) Reserve (Eagle Zone: Proven, 27 Mt @ 0.80 g/t for 685,000 oz,
and Probable, 90 Mt @ 0.62 g/t for 1,778,000 oz; Olive Zone: Proven, 2 Mt @ 1.02 g/t for 58,000
oz, and Probable, 5 Mt @ 0.93 g/t for 142,000 oz; Total Proven & Probable of 123 Mt, 0.67 g/t,
2,663,000 oz; all as described in the technical report titled “NI 43 -101 Feasibility Study Technical
Report for the Eagle Gold Project, Yukon Territory, Canada” dated October 26, 2016 and with an
effective date of September 12, 2016), and is set to be Yukon’s next operating hardrock gold mine.
The consolidated Aurex-McQuesten property has exceptional infrastructure. It is transected by the
Silver Trail Highway, the main road connecting Mayo to Keno City, as well as being covered by a
network of historic exploration access ro ads and trails. Additionally, an active three -phase power
line runs through the property. An airstrip and full support services are available in Mayo, 35
kilometres (“km”) to the south.
Aurex-McQuesten Property Geology
The Aurex -McQuesten property repres ents a structurally controlled, intrusion related gold -silver
mineralized system. Narrow quartz monzonite dykes of the Tombstone intrusive suite have been
identified on the property to date and geophysical interpretations hypothesize a buried intrusive
underlies the project area. The proper ty is predominantly underlain by a series of meta -
sedimentary lithologies of the Yukon Group of the Yusezyu Formation, a part of the Hyland
metasediments of probable Precambrian and/or Palaeozoic age. A northeast -striking system of
faults and vein faults host the Keno Hill silver -lead-zinc veins and a later, dominantly northwest
trending series of faults, offsets the earlier east -west trending low -angle thrust faults. All of the
faults are interpreted to contribute to the localization of gold mineralization.
McQuesten Property History and Mineralization
The McQuesten property is comprised of 73 Quartz Mining Claims with a long history of precious
metals exploration and exploitation including over 11,000 meters (“ m”) of RC /RAB drilling (286
holes), over 4,900m of diamond drilling from 47 holes, 35 trenches (3,900m), over 350 soil
samples and a 2006 detailed airborne EM -Mag survey. Anomalous gold -in-soils combined with
drill results and detailed trenches have defined a 1.6 km by 1.3 km area of anomalous +0.5 grams
per tonne (“g/t”) gold (“Au”). Drilling highlights* in this area (located within 500m of the Aurex claim
boundary) include 18.3m @ 3.74 g/t Au and 1.1m @ 84.8 g/t Au. The McQuesten property has
Gold - Tungsten - Tin mineralization defined in skarn horizons or adjacent to the narrow quartz
monzonite intrusives of the Tombstone suite, similar to mineralogy at Victoria’s Eagle Project. The
McQuesten property also has the potential for overlapping Silver - Lead - Zinc vein style
mineralization characteristic of the KHSD.
The potential in the McQuesten area lies in expanding the size of the mineralized zones by further
drill testing of skarn horizons along strike and in increasing the overall gold grade by definition of
the higher grade gold zones both within skarn and quartzite horizons. Indications of this potential
have been demonstrated by widely spaced drilling in the West Zone, where two gold bearing skarn
horizons proximal to later structures have returned significant results* such as:
3.23 g/t Au over 21.3m (RC97-03)
1.77 g/t Au over 35.3m (RC97-02)
1.37 g/t Au over 36.6m (MQ00-4)
3.31 g/t Au over 4.3m (MQ00-4)
Similarly, in the East Zone, drilling has returned significant intercepts* from four skarn horizons:
4.10 g/t Au over 9.6m (D83-01)
0.54 g/t Au over 14.0m (D83-02)
4.10 g/t Au over 3.0m (D83-04)
5.60 g/t Au over 3.0m (D83-06)
1.51 g/t Au over 11.1m (D83-06)
1.11 g/t Au over 33.0m (RC97-06)
*The true widths of McQuesten mineralization are not known. All rep orted intersections refer to total interval
lengths of the extent of mineralization as it is not currently possible to determine these true widths due to the
density of exploration data and the diversity of mineralization styles. Additionally, these report ed historical
grades have not been confirmed by the Company as of yet; however data verification is planned this season.
Aurex Property History and Mineralization
The Aurex property comprises 433 Quartz Mining Claims and also has a long history of mineral
exploration and exploitation with over 17,000m of RC and diamond drilling in 477 drill holes, over
3,000 soil samples as well as trenches and detailed geophysical surveys.
Early exploration of the Aurex property (circa 1900’s) was focused exclusively on Keno Hill type
silver veins, gold mineralization on these claims was first reported in 1955.
Exploration during the 1990’s included 3,089m of percussion drilling in 148 holes and a 4.25 km
induced polarization (IP) geophysical survey. In 2000, Newmont Mining Corporation and Expatriate
Resources Inc. initiated a multi -million dollar exploration program of mapping, sampling and
airborne geophysics over the Aurex property.
In 2003, StrataGold Corporation (“ StrataGold”) completed 4,038m of diamond drilling in 2 6 holes
with anomalous gold, arsenic, bismuth, antimony and tungsten reported from these exploration
initiatives. In 2007, StrataGold collected 342 soil samples on the north -east portion of the claim
block in an area of interest defined by anomalous silver values. In 2011 and 2016, Victoria
completed additional soil sampling, prospecting and geologic mapping programs on the Corkery
Creek target area.
Two distinct styles of gold mineralization have been identified on the Aurex property to date: 1)
sheeted quartz arsenopyrite veinlets with associated brittle fault and vein breccias with anomalous
gold, arsenic, bismuth and tungsten mineralization; and 2) stratabound silicified skarn horizons
with anomalous gold, arsenic, bismuth, antimony and tungsten associations.
Significant intersections * of sheeted vein style mineralization include 15.00m of 1.51 g/t Au,
including 7.50m of 2.51 g/t Au and 19.17m of 0.97 g/t Au. Significant intersections of sheeted
stratabound silicified skarn horizons include 10.01m of 0. 74g/t Au including 1.01m of 5.30 g/t Au.
Mineralized structures and stratabound horizons remain open in all directions. A grab sample of
quartz-sulphide vein material taken from the Corkery Creek target area in 2012 returned up to 26.8
g/t Au with 1.2 g/ t silver (“Ag”), >10,000 ppm arsenic, 216 ppm antimony and 94 ppm bismuth. A
grab sample of mineralized vein material from a dump alongside one of the old shafts reportedly
assayed 22,320 g/t Ag. Specimens of massive sulphide and limonite -stained boulders returned up
to 7.01 g/t Au, 267 g/t Ag and 8.46% zinc.
Highlights* from the 2003 StrataGold drill program are presented below:
Drill Hole # From (m) To (m) Length (m) Gold (g/t)
AX-03-12 31.00 32.50 1.50 8.89
AX-03-12 37.00 52.00 15.00 1.51
Including 37.00 44.50 7.50 2.51
AX-03-16 117.70 136.87 19.17 0.97
AX-03-10 81.50 92.00 10.50 1.08
Including 89.00 90.50 1.50 4.61
Drill Hole # From (m) To (m) Length (m) Gold (g/t)
AX-03-22 101.10 113.10 12.00 0.98
Including 103.20 104.70 1.50 4.63
AX-03-24 105.10 116.38 11.28 0.90
AX-03-08 184.96 194.97 10.01 0.73
Including 187.96 188.97 1.01 5.30
AX-03-09 75.5 113.00 37.50 0.51
*The true widths of Aurex mineralization are not known. All reported intersections refer to total interval
lengths of the extent of mineralization as it is not currently possib le to determine these true widths due to the
density of exploration data and the diversity of mineralization styles. Additionally, these reported historical
grades have not been confirmed by the Company as of yet; however data verification is planned this season.
.
Highlights of the Definitive Agreement with Victoria (the “Aurex Agreement”):
Under the terms of the Aurex Agreement, which is subject to TSX -V approval, Banyan may earn
up to a 100% interest in the Aurex property in three (3) stages:
Initial 51 % Option Interest - To acquire the initial 51% Option Interest in the Property, the
Company is required, over a period of four (4) years, to issue in stages a total of 3 million
common shares in the capital of the Company, and to incur in stages minimum ex ploration
expenditures totaling $1.6 million on the Property. Banyan will act as the Property’s operator
during the initial four -year term and has the option to defer expenditures into a 5 th year.
Following the earning of the 51% Option Interest, a joint venture (“JV”) will be formed and
Banyan will have the ability to elect to earn an additional 24% (the “Aurex Additional 24%
Interest”).
Aurex Additional 24% Interest - In order to earn the Aurex Additional 24% Interest, such that
Banyan would have an aggregate interest of 75% in the Property, Banyan will be required to
spend an additional $3.5 million in exploration expenditures over five (5) years. Upon having
earned the Additional 24% Interest, Banyan will continue to act as the Property’s operato r
and may elect to earn an additional 25% (the “Aurex Additional 25% Interest”).
Aurex Additional 25% Interest - In order to earn the Aurex Additional 25% Interest, such that
Banyan would have an aggregate interest of 100% in the Property, within two (2) y ears
Banyan must pay Victoria $2 million cash or shares and grant Victoria a 6% net smelter
return (“NSR”) royalty with buybacks totaling $7 million to reduce to a 1% NSR royalty on Au
and a 3% NSR royalty on Ag.
As part of the initial letter of intent, Victoria made a strategic investment in Banyan of $100,000 and
was issued 1,250,000 units of Banyan, which was approved by the TSX -V on March 7, 2017.
Victoria now owns 5.27% of Banyan’s outstanding shares.
Highlights of the Definitive Agreement with Alexco (the “McQuesten Agreement”):
Under the terms of the McQuesten Agreement, which is subject to TSX -V, Government of Canada
and Silver Wheaton Corp. approvals, Banyan may earn up to a 100% interest in the McQuesten
property in three (3) stages:
Initial 51% Op tion Interest - To acquire the initial 51% Option Interest in the Property, the
Company is required, over a period of four (4) years, to issue in stages a total of 1.6 million
common shares in the capital of the Company, and to incur in stages minimum expl oration
expenditures totaling $1.6 million on the Property. Banyan will act as the Property’s operator
during the initial four -year term and has the option to defer expenditures into a 5 th year.
Following the earning of the 51% Option Interest, a JV will be formed and Banyan will have
the ability to elect to earn an additional 24% (the “McQuesten Additional 24% Interest”).
McQuesten Additional 24% Interest - In order to earn the McQuesten Additional 24% Interest,
such that Banyan would have an aggre gate interest of 75% in the Property, within three (3)
years Banyan must spend an additional $1 million in exploration expenditures, deliver a
Preliminary Economic Assessment and pay Alexco $600,000 in cash or shares of Banyan.
Upon having earned the Addi tional 24% Interest, Banyan will continue to act as the
Property’s operator and may elect to earn an additional 25% (the “McQuesten 25% Interest”).
McQuesten Additional 25% Interest - In order to earn the McQuesten Additional 25% Interest,
such that Banyan would have an aggregate interest of 100% in the Property, within two (2)
years Banyan must pay Alexco $2 million in cash or shares, deliver a Pre -Feasibility Study
and grant Alexco a 6% NSR royalty with buybacks totaling $7 million to reduce to a 1% NSR
royalty on Au and a 3% NSR royalty on Ag.
As part of the initial letter of intent, Alexco made a strategic investment in Banyan of $350,000 and
was issued 4,375,000 units of Banyan, which was approved by the TSX -V on March 7, 2017.
Alexco currently has a 6 .64% equity ownership in Banyan. Pursuant to the terms of the
McQuesten Agreement, Alexco has the right to participate in future financings and has a right to a
seat on the Company’s Board as long as it maintains a minimum 10% equity ownership in Banyan.
Technical Information
The technical information in this news release has been reviewed and approved by Paul D. Gray,
P.Geo., a Qualified Person as defined by NI 43-101.
About Banyan Gold
Banyan is a gold exploration and development company whose flagship p roperty, the Hyland Gold
Project, is approximately 70km NE of Watson Lake, Yukon, along the southeast end of the Tintina
Gold Belt. The Main Zone gold Inferred Resource, at a 0.6 g/t gold equivalent cutoff, hosts a NI 43 -
101 resource of 12,503,994 tonnes c ontaining 361,692 ounces gold at 0.9 g/t and 2,248,948
ounces silver at 5.59 g/t for a combined gold and silver 396,468 ounces gold equivalent.
Banyan trades on the TSX -Venture Exchange under the symbol “BYN”. For more information,
please visit the corporate website at www.BanyanGold.com or contact the Company.
ON BEHALF OF THE BANYAN BOARD OF DIRECTORS
(signed) "Tara Christie"
Tara Christie
President & CEO
For more information, please contact:
Tara Christie David Rutt
Tel: (888) 629-0444 Tel: (888) 629-0444
Email: [email protected] Email: [email protected]
CAUTIONARY STATEMENT: Nether TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the
policies of the T SX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. No stock exchange,
securities commission or other regulatory authority has approved or disapproved the information contained herein. This news release
contains forward-looking information, which is not comprised of historical facts. Forward -looking information involves risks,
uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially
from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but
is not limited to, Banyan’s objectives, goals or future plans, statements regarding exploration expectations and exploration or
development plans. Factors that could cause actual results to differ materially from such forward-looking information include, but
are not limited to, uncertainties inherent to preparing a resource estimate within expected timeline, capital and operating costs
varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain
required governmental, regulatory, environmental or other project approvals, political risks, uncertainties relating to the availability
and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity
prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry,
enhanced risks inherent to conducting business in any jurisdiction, and those risks set out in Banyan’s public documents filed on
SEDAR. Although Banyan believes that the assumptions and factors used in preparing the forward-looking information in this news
release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news
release, and no assurance can be given that such events will occur in the disclosed time frames or at al l. Banyan disclaims any
intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or
otherwise, other than as required by law. Paul D. Gray of Banyan Gold Corp. is a “qualified person” within the meaning of such
term as set forth in National Instrument 43 -101 of the Canadian Securities Administrators, and has verified and supervised the
preparation of all of the scientific and technical information contained in this news release.
Statements in this news release regarding Banyan which are not historical facts are “forward -looking statements” that involve risks
and uncertainties. Such information can generally be identified by the use of forwarding -looking wording such as “may”, “will”,
“expect”, “estimate”, “anticipate”, “intend”, “believe” and “continue” or the negative thereof or similar variations.