Accelerate has scored itself a dominant landholding in Canada among the gold majors
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Special Report: One small cap explorer has secured itself a dominant position on a largely consolidated, highly prospective patch of ground in a past producing gold region of Canada that previously witnessed piecemeal exploration and mining.
Accelerate Resources (ASX:AX8) has landed itself a low-cost, advanced high-grade exploration opportunity in British Columbia that is surrounded by multi-million-ounce gold mines, and a couple of mining giants, but has never been controlled by just one company.
The Rossland gold project that the company plans to acquire covers about 3,000 hectares of ground that was previously a bunch of much smaller land packages owned by several companies.
One keen Canadian prospector saw the potential of this ground and as the mining rights over these areas started to lapse, he set about picking up the available tenements.
This ground hosts the same geological structures as the adjacent high-grade Le Roi mines — owned by Canada’s largest diversified miner, Teck — which produced more than 2.7 million ounces of gold, 3.5 million ounces of silver and 71 tonnes of copper between 1894 and 1941.
Perth based Currie Rose President Michael Griffiths, who has agreed to facilitate Accelerate Resources to initial drill program at Rossland, commented that the Currie Rose consolidated as much ground as they could, but there were still opportunities to expand the land package.
“There’s the opportunity for further consolidation by acquiring some of the other smaller players in the region, which the vendor couldn’t do because he didn’t have the funds to do it,” he said.
“So the real upside is looking to acquire some of those other areas, which would make the package even better than what it currently is.”
Accelerate has also pegged areas (indicated by the dotted lines on the map above) that it has the opportunity to merge into its land package once the mining rights lapse.
If anyone knows what to look for when hunting for a potentially profitable project, it’s Griffiths, who has headed up teams that have made several major discoveries.
He has more than 35 years of experience in the minerals and energy sector in Australia, Canada and Africa.
Griffiths and his team at Otter Exploration made a number of discoveries in the Tanami Desert in northern Australia during the late 80s/early 90s that led to a resource inventory of 800,000oz of gold.
He also helped turn a greenfields discovery in Tanzania into a 4-million-ounce, 1.8-gram-per-tonne (g/t) resource and led the team that uncovered about a million ounces at ~5g/t in Eritrea for Sub-Sahara Resources before it merged with Chalice Gold Mines.
Now extremely well versed in gold exploration, Griffiths struck the deal to pick up this highly prospective landholding in British Columbia.
Accelerate saw the opportunity and pounced, inking a binding term sheet with Griffiths’ company Currie Rose to undertake an eight-month due diligence exploration program, which if successful will lead to a definitive earn-in agreement allowing Accelerate to earn up to 100 per cent of the Rossland project.
The deal includes Griffiths joining Accelerate Board once the company has earned a 51 per cent stake and taken over as project manager, Griffiths will take a seat on the board as technical director.
Griffiths says the Rossland project ticked all the boxes including being located in a first world mining jurisdiction that hosts several large mines and has been significantly underexplored.
“Firstly, it was high-grade gold and this project in particular surrounds one of the biggest lode gold deposits in British Columbia,” he said.
“It had the specific qualities I was looking for, so all those boxes are ticked. It really hasn’t been touched for well over a century.”
Surface rock chip samples taken from the Eleanor prospect returned extremely high grades of up to 130.5g/t gold.
Meanwhile, limited historical drilling done at the Gertrude prospect returned hits of 6.1m at 13.29g/t from 162m, 4.5m at 12.7g/t gold from 164m, and 5m at 17.18g/t gold from 151m.
Accelerate says multiple extensions to mined high-grade structures trend into the Rossland project area but have remained underexplored since mine closure in 1941.
The Rossland project is also located within 80km of three processing plants, alleviating the need for Accelerate to spend a large sum of money on building a plant to process any of the gold it eventually mines.
Canadian gold major Teck has an interest in the area and operates the Trail zinc smelter, one of the world’s largest, 10km from the Rossland project.
Canadian mining heavyweight Kinross Gold is also active in the region, on the US side of the border.
With majors like Teck and Kinross nearby, as well as multiple processing plants, this provides smaller players like Accelerate with a number of opportunities.
“I would’ve thought that if we can pull enough resources together we become a more serious option for them to work with,” Griffiths said.
A key focus for Griffiths has been establishing a positive relationship with key stakeholders early on.
“That’s been part of what we’ve been trying to do, is make sure that the local stakeholders don’t feel like we’re stealing their livelihood and that there is an opportunity to cohabit and coexist,” he said.
This has been a successful strategy for Griffiths and Accelerate because stakeholders and the City of Rossland are supportive of their effort to reignite gold mining in the region.
Back in the late 1890s, Rossland became one of Canada’s largest cities thanks to a gold rush.
But following the fizzling out of the gold rush, the town dwindled to a population of just over 3,500 and now solely relies on its ski resort for much-needed income during the winter season.
Importantly, Accelerate is able to tap into an established, high-calibre technical and
support team that is ready to mobilise to drill a series of high impact targets over the next six to eight months.
The company expects to deliver significant ongoing news flow.
This article was developed in collaboration with Accelerate Resources, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.