Engineer Gold Mines Signs Agreement to Acquire Adjoining Tag Deposit
ENGINEER GOLD MINES LTD.
Suite 804 - 750 West Pender Street
Vancouver, B.C. V6C 2T7
Telephone: 604.682.2928
Fax: 604.685.6905
www.engineergoldmines.com
Engineer Gold Mines Signs Agreement to Acquire Adjoining Tag Deposit
August 4, 2020
Vancouver, BC – Engineer Gold Mines Ltd. (the “Company”) (TSXV: EAU) announces that it
has entered into an agreement to acquire the Tag property, which ad joins its Engineer Gold
Mine property , located 3 0 km west of Atlin, British Columbia , to the northwest, and lies 6
kilometres north of the historic al Engineer mine workings. A map is available on the company ’s
website at www.engineergoldmines.com/news
The 1,070 hectare Tag property covers the 025 or Main zone, which contains, as defined by the
National Instrument (“NI”) 43-101 Standards for Disclosure for Mineral Projects, an historical
mineral resource estimate including 250,000 tonnes of 2.97 g/t Au (cut) and 12.09 g/t Ag (cut),
indicated and 400,000 tonnes of 2.98 g/t Au (cut) and 9.91 g/t Ag (cut) inferred, using a
minimum core length of 2.0 metres and a cut-off grade of 3.0 g/t gold equivalent (combined gold
and silver values) , calculated on silve r to gold ratio of 59.927 . The resource is taken from a
technical report filed on SEDAR entitled “Technical Report on Resource Estimates for the Tag
Property, No rthern Brit ish Colum bia”, p repared for C ZM Capital Corporation by Reddick
Consulting Inc. and dated December 29, 2009.
Engineer Gold Mines’ president, Andrew H. Rees stated “The Tag acquisition will be an exciting
development for the Company as it is a contig uous expansion of the north end of the Engineer
Project. The significant exploration and development work already completed at Tag will provide
a wealth of data to Engineer’s t echnical team and immediately enhance the geological
understanding of the Engineer Project . The Company intend s to complete the work necessary
to classify the historic resource estimate as a current mineral resource.”
Practices consistent with CIM (2005) we re applied to the generation of the historical mineral
resource estimate and the parameters of the modeling are fully describ ed in the NI 43-101
report referenced above . The estimate uses a vertical cross -sectional polygonal method and is
based on 28 diamond drill holes within a 900 metre long extent. It appears to have economic
potential that would be best su ited for development by the use of underground mining methods.
A qualified person has not done sufficient work to classify the historical estimate as a current
mineral resource based on revised practices as per CIM (2014) and should not be t reated or
relied upon as such. The Company consid ers the NI 43-101 report to b e relevant given that no
additional work of significance has been completed since the iss uance of the historical Mineral
Resource Estimate.
Although old hand trenches were later found, modern exploration on the property was initiated
by the discovery of visible go ld in an outcrop at the southern end of a 200 to 205 degree
trending, steep we sterly dipping fault zone (025FZ) by government geologists in 198 7-8, from
which a sample returned 5.35 g/t Au and 19.0 g/t Ag (Main zone). The 025FZ structure is easily
traced by a strong lineament along a distance of 6.5 kilometres within the property bo undaries.
Work to date on the Tag property includes prospecting and mapping, petrography, fluid
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inclusion and scanning electron microscope studies, rock and s oil geochemistry, airborne and
ground geophysics, trenching, 11,476m of drilling in 69 dr ill holes and the historical NI 43-101
resource estimate.
Regionally, the Tag property is situated at a major flexure within the deep se ated, long lived
Llewellyn fault zone. The flexing forms dilational openings, favourable for the formation of veins.
The Main zone consists of quartz-minor carbonate veins, stockworks and breccias, commonly
with drusy and crustiform textures with fine-grained disseminations and thin veinlets of pyrite
and arsenopyrite throughout the fault zone and in the adjacent wall rock contact s. Alteration
consists of silica -carbonate with lesser chlorite, sericite and mariposite. The mineralization is
hosted by well-bedded sedimentary hos t roc ks including a rgillites, siltstones, greywackes and
conglomerates. Both the mineralization and host ro cks are similar to that within the historical
Engineer Gold mine workings.
Additional potential exists at depth on the Main zone, in other areas along the 025FZ structure
and on the Barney zone , about 3.5 km north of the Main zone . The Barney zone comprises a
5 to 25m wide zone about 250m long. It consists of quartz breccia zones mineralized with pyrite,
pyrrhotite and chalcopyrite, associated with sericite-carbonate altered zones along the margins
of a quartz diorite stock apparently cut by the 025FZ. A grab sample reportedly returned 7.8 g/t
Au.
The southern end of the complex series of fault and shear zones , which comprises the 025FZ
structure, exhibits brittle deformation with epithermal style mineralization, which is confirmed by
fluid i nclusions. Further north , and alon g the western strands of the fault, more ductile
deformation is evident with li stwanite alteration, suggestive of s tructurally hosted orogenic lode
gold. Potential exists for both mineral deposit types.
Closing of the transaction is subject to completion of a definitive agreement based on the key
terms outlined in the binding Memorandum of Understanding (“MOU”). The MOU outlines the
following considerations to Taku Gold Corp. in exchange for the TAG Property:
• $200,000 in cash, with $100,000 due on or before July 31, 2020 and an additional
$100,000 due on or before November 30, 2020;
• $270,000 in shares based on the issuance of 2,000,000 common sh ares of Engineer at
$0.135 within five days of ap plicable stock exchange approvals of a definitive
agreement;
• $250,000 in advance royalty payments over ten years, payable in cash or shares;
• $500,000 payment upon on completion of a Preliminary Economic Ass essment or
Feasibility Study that includes mineral resources located within the Property; and
• A 1.0% Net Smelter Return royalty, which can be purchased by Engineer for $1,000,000
in cash.
Engineer and Taku Gold expect to complete a definitive agreement on or before August 31,
2020. A definitive agreement is subject to applicable stock exchange approval.
A site visit was complet ed, and the technical information in this news release reviewed, by Jean
Pautler, P.Geo., a qualified person with respect to NI 43-101.
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About Engineer Gold Mines Ltd.
Engineer Gold is focused on the exploration and development of the 100% -owned, Engineer
Gold Mine Property, centered on the Historic high -grade Enginee r Gold Mine situated 32 km
southwest of Atlin, B.C. Pre vious work ha s identified numerous high -grade vein and shear -
hosted bulk-tonnage gold exploration targets including Wann River to the southwest and Happy
Sullivan to the northeast of the Engineer Gold Mine.
For additional information please visit the company website at www.engineergoldmines.com
On Behalf of the Board of Directors
Contact Information
Engineer Gold Mines Ltd. Corporate Inquiries:
"Andrew H. Rees" Andrew H. Rees: 604-505-3739
Mr. Andrew H. Rees Email: [email protected]
President
Cautionary Note Regarding Forward-Looking Statements
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in
the policies of the TSX Venture Exchange) accepts resp onsibility for the adequacy or accuracy
of this release.
This news rel ease contains certain forward looking statements which involve known and
unknown risks, delays, and uncertainties not under the c ontrol of Engineer Gold Mines Ltd.
which may cause actu al results, p erformance or achievements of Engineer Gold Mines Ltd. to
be materially different from the results, performance or expectation implied by these forward
looking statements. By their nature, forward looking statements involve risk and uncertaint ies
because they relate to events and depend on factors that will or may occur in the future. Actual
results may vary depending upon exploration activities, industry production, commodity demand
and pricing, currency exchange rates, and, but not limited to , general economic factors. Neither
the TSX Venture Exchange nor its Reg ulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the ad equacy or accuracy of
this release.
TAG PROPERTY
Location Map
Interpretation Legend
Drilling
Potassium anomaly
Possible fault / shear zone
Magnetic high lineament
Strong VLF-EM conductor
Moderate VLF-EM conductor
Weak VLF-EM conductor
VLF-EM conductor ID
First Vertical Derivative of the TMI (airborne)(nT/m)
-2.0 -1.0 -0.7 -0.5 -0.3 -0.2 0.0 0.1 0.3 0.4 0.5 0.6 0.8 1.0 1.2 1.7
Engineer