Macassa Creek Gold Property Mishibishu Lake Area, Wawa, Ontario Location, Accessibility, Infrastructure and Local Resources The property is located 40km west of Wawa, Ontario, in the David Lakes (Mishibishu) Area, Sault Ste. Marie Mining Division, and District of Algoma, Ontario. Vehicular access to the property is gained from Highway 17 North, 50 km north of Wawa, then west 50km along the Paint Lake Road to the Mishi Mine complex, then west for 5 km past the mine where old tractor roads lead west through to the claim block. A power transmission line parallels the Paint Lake road along its entire length. The community of Wawa is the nearest source of manpower, supplies and services to logging, mining and exploration industries. Wawa is easily accessed and provides rail, ship, road and air transportation facilities. Location Map, Macassa Creek Property, Mishibishu Lake Area Land Tenure The mineral rights are held by Argo Gold Inc. of Toronto, Ontario. There are two claims: SSM 1180736 (8 units) and SSM 1255352 (5 units). Claim SSM 1180736 is bordered to the north by Wesdome claim SSM 3020021 and to the east by Wesdome Leases. The property is situated approximately 4 km west of Wesdome’s Mishi Gold Mine. 1 Land Tenure, Macassa Creek Property, Argo Gold Recent and Historical Exploration The Mishibishu area has seen sporadic exploration since the early 1900s through to about 1935 when high grade gold was discovered north of Mishibishu Lake. In 1937 Hollinger Consolidated Mines, Macassa Mines and Erie Canadian Mines carried out prospecting, stripping, trenching and diamond drilling on their properties. Parts of the Erie Canadian claims covered the subject property. Erie Canadian noted shearing and quartz veining. Beginning in 1983, MacMillan Energy and the MacMillan/Granges Joint Venture conducted numerous exploration programs including airborne surveys, line cutting, prospecting, soil geochemistry, geology and diamond drilling on their Mishi Project, which included the Macassa Creek property. Recent exploration on the property from 2000 – 2016 consisted of airborne geophysics, line cutting, ground magnetometer survey, geological mapping, stripping and sampling. The Magnacon Gold Deposit and the Mishi Gold Mine are both located on strike to the east of the Macassa Creek Property along the Mishibishu Lake Deformation Zone. In 2014 Wesdome initiated an exploration program to assess the mineral potential to the east and west of the Mishi Open Pit. The drill program to the west will test the extension of the Mishi Gold Deposit over a 3 km strike length every 200 m. This program will likely reach the western end of the Wesdome Leases, adjacent to the Macassa Creek Property. 2 Geology, Structure, and Mineralization The block is underlain by two sequences (north and south) of west-southwest trending metavolcanic rocks that flank a thick clastic metasedimentary sequence. The metavolcanic rocks consist of amphibolitized, massive, mafic to intermediate flows intercalated with narrow felsic units. The metasedimentary rocks comprise a series of polymictic conglomeratic horizons within a series of gritty quartz sandstones and dirty wackes. The metamorphic grade of the supracrustal rocks underlying the Macassa Creek Block is upper greenschist to lower amphibolite facies. Late diabase dikes cross cut all rock types. The Mishibishu Lake Deformation Zone (MLDZ) crosses the Macassa Creek Property. The rocks within the deformation zone are well foliated, chlorite-calcite schists (mafic volcanic protolith) and gritty, quartz-chlorite (+/-sericite) schists (sedimentary protolith). The degree of alteration and deformation within the zone varies in intensity and thickness (100-800 metres wide) along strike. Gold mineralization in the Mishibishu Lake Deformation Zone has been traced by surface sampling and diamond drilling over an area up to 800 metres wide and 2.0 kilometre long. The highly strained, quartz-veined, arsenopyrite-rich zones produce the most consistent gold values. Past exploration has defined several high strain zones within the broad Mishisbishu Lake Deformation Zone in the Macassa Creek area. Regional Geology, Macassa Creek Property, Mishibishu Greenstone Belt Gold mineralization in the Macassa Creek and Mishibishu Lake area is localized within quartz-veined, highly strained, grey, siliceous, quartz-eye bearing rocks. Pervasive carbonate, amphibole, garnet, biotite and sericite alteration varies along strike within the deformation zone. The tourmaline, pyrite, arsenopyrite and ankerite-bearing quartz veins range in width from 1 to 40 cm and often have 3-4 cm wide haloes containing coarse- 3 grained (0.5 centimetre) disseminated arsenopyrite crystals. Visible gold occurs as rare fine-grained specks within the quartz. Gold values returned from samples collected within the high strain zones include grab samples containing trace to 14.74 grams gold per tonne, trench channel samples containing trace to 11.69 grams gold per tonne over 0.8 metres and diamond drill core samples containing trace to 2.92 grams gold per tonne over 2.94 metres. Local Geology, Macassa Creek Property, Mishibishu Lake Area Detailed Geology, Macassa Creek Property (after Reid et. al. 1992) 4 Diamond Drilling (Dominion Explorers, 1986-87) Diamond drilling by Dominion Explorers in 1986 and 1987 indicated a low grade eastwest trending mineralized zone on Argo Gold claim immediately south and west of Wesdome claims and leases. Highlights of the drill results are as follows: DDH MAC-86-05 MAC-86-06 MAC-86-12 From (feet) 85 103 166 170 180 MAC-86-13 50.5 MAC-87-15 79 MAC-87-16 101.5 MAC-87-17 87 MAC-87-19 102 MAC-87-24 37 67 *Calculated weighted average To (feet) 92.75 117 170 173 182.5 75.5 116.5 131.25 97 114 57 80 Length (feet) 7.75 15 4 3 2.5 25 37.5 29.75 10 12 20 13 Assay (oz/ton Au) 0.04 0.044* 0.067 0.53 0.23 0.026* .032 .045 0.18 0.054* 0.02 0.03 Location Map of Diamond Drill Holes, (after Dominion Explorers, 1986-87) 5 Summary of Macassa Creek Property Low grade gold mineralization has been found on the Macassa Creek Property during previous exploration programs. The mineralization occurs within shear zones close to the metavolcanic-metasedimentary contact which form part of the regional high-strain zone (Mishibishu Lake Deformations Zone) that also hosts the Mishi and Magnacon Deposits. Drilling programs by Wesdome Mines west of the Mishi Mine were initiated in 2014 and are continuing through 2016 over a 3 km strike length to the west of the Mishi Deposit, with drill holes spaced at 200 metre intervals. The current Wesdome and historical drilling follow a series of gold prospects and occurrences. A number of these occurrences are found on the Macassa Creek Property. The Macassa Creek Property occurs on the western extension of the mineralized zone that hosts the Mishi and Magnacon Deposits. The high-strain zone is regional in scale and consists of anatomizing shear zones that occur close to a regional contact between metavolcanic and metasedimentary rocks. The nature of the Mishi Gold Deposit is a moderately low grade, high tonnage deposit (open pit bulk mining). The deposit model for the Macassa Creek Property will be similar to the Mishi Deposit. The Macassa Creek Property is located close to the Mishi Deposit and the Magnacon Mill complex. The claim block is accessible by road from Wawa and locally, by logging roads. There is good access to local resources and electrical power and milling facilities. The two claims have had substantial historical exploration work which would need to be compiled and utilized to develop the best plan for exploration going forward. Geology and Gold Occurrences west of the Mishi Gold Deposit 6 Summary and Conclusions • Gold mineralization occurs within quartz-bearing shear zones straddling the metavolcanic-metasedimentary contact on the western continuation of the Mishibishu Lake Deformation Zone that also hosts the Mishi and Magnacon Deposits. • 1986 and 1987 drilling indicated a low grade gold bearing east-west trending mineralized zone on Argo Gold claim immediately south and west of Wesdome claims and leases. • Drilling program currently underway by Wesdome Mines west of the Mishi Mine over a 3 km strike length to the west of the Mishi Deposit, with drill holes spaced at 200 metre intervals. • The nature of the Mishi Gold Deposit is a moderately low grade, high tonnage deposit (open pit bulk mining). The deposit model for the Macassa Creek Property will be similar to the Mishi Deposit. • The Macassa Creek Property is located close to the Mishi Deposit and the Magnacon Mill complex. The claim block is accessible by road from Wawa and locally, by logging roads. Recommendations • Complete a geological compilation of historical data; create a 3D model from the known drilling. • Establish a structural and geological model based on results of geophysics, geochemistry and geology in the area. • Locate and georeference historic exploration such as stripping, trenching, sampling, grid lines, DDH collars. • Prospecting/stripping/trenching/sampling of identified mineralized areas; structural/geological mapping of mineralized shear zones. • Drilling program of selected target areas based on fieldwork and geological/structural interpretation. 7 Knowledge Gaps • Is it possible to follow discrete mineralized shear zones from drilling and surface stripping? How dominant is quartz veining within mineralized zones? • How many mineralized shear zones are present on the property? Are mineralized zones disposed en echelon? Is there an obvious ductility contrast between rocks within mineralized zone? • Is there sufficient grade continuity to warrant additional drilling to assess potential for a bulk mining operation? • At current gold prices, how significant is the depth potential of a deposit model such as found at the Mishi Mine? 8 Mishi Gold Deposit (after H.Miree and W. Bates, 1991). Historical drilling by Granges-MacMillan JV identified a Main Zone consisting of five ore lenses in a staked, en echelon series of plunging quartz vein aggregates. Lenses were defined based on maximum abundance of quartz vein material, concident gold values, and characteristic “stratigraphic” position. Two basic ore types are present: 1. Mafic-hosted consisting of chlorite-carbonate schist, mafic wacke, biotite quartz porphyry; 2-10% pyrite; gold is associated with pyrite and as free gold in quartz; iron carbonate ranged from 10-30% 2. Felsic-hosted consisting of quartz-sericite schist, sheared quartz-feldspar porphyry; 1-3% pyrite with gold predominantly free in quartz; iron carbonate in veins ranged from 0-3% Grade continuity was better in the mafic-hosted (i.e. higher iron precursor rocks) ore zones where gold is hosted by pyrite disseminations within the veins as well as the wall rocks. Gold mineralization is more discontinuous in the felsic-hosted ore zone (with lower pyrite content) where the gold is distributed almost entirely in the quartz veins. Plots of the grade, percent quartz vein, and grade x width, all indicate a 30o to 40 o easterly plunge for each of the ore lenses. This is consistent with the axes of kink folds which rake from 25 o to 50 o on a 45 o north dipping plane. Mineral lineation plunge 60 o 80o west (perpendicular to the plunge of fold axes). The lateral extent of the ‘productive zone’ (#2 shear) is coincident with the thickest portion of a gabbro unit. Thus the Main Zone is sandwiched between two of the most competent rock types: the gabbro unit and a ‘chlorite clast conglomerate’ (i.e. intermediate tuff). Outside of this confining situation, mineralization is more diffuse. Generalized Geology & Structure, Mishi Mine area (after H.Miree and W. Bates, 1991) 9 Idealized cross section; Mishi Main Zone (after H.Miree and W. Bates, 1991) Mishi Open Pit and Mineralized Zones (after Wesdome Gold Mines) 10 Mishi Open Pit 2011 (from Wesdome Gold Mines website) Mishi Open Pit 2015 (Wesdome Gold Mines website) 11
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