Aurizon has signed a letter of intent with Azimut Exploration Inc. ("Azimut"), regarding Azimut's Rex South property, in Nunavik, Quebec.
The Rex South property comprises 1,274 claims covering a surface area of 555 square kilometres, about 145 kilometres southeast of the community of Puvirnituq. The Rex South property is 42 km long by 15 to 20 km wide and hosts strong exploration potential based on a combination of the following factors:
- An extensive, multi-element, geochemical footprint in lake-bottom sediments, including anomalies in arsenic, antimony, gold, copper, molybdenum and rare earth elements;
- A geophysical signature indicating a major structural boundary; and
- The presence of several mineralized prospects, including high-grade gold (up to 33 grams of gold per tonne) and copper (up to 6.4% copper) obtained by grab samples.
Under the letter of intent, which sets forth the principal terms of a proposed agreement between the parties, Aurizon would be entitled to earn an initial 50% interest in the property by incurring exploration expenditures of $5.0 million over a five (5)-year period, and an additional 15% interest upon delivery of a bankable feasibility study and making additional payments and expenditures. Azimut would be the operator during the first twelve (12) months with a joint technical committee. The principal terms of the agreement are:
- Making an initial cash payment of $150,000 on signing, and making further cash payments for an aggregate of $580,000 over four years;
- Incurring minimum work expenditures of $1,000,000 during the first year, and incurring further work expenditures for an aggregate of $5,000,000 over five years, including 5,000 metres of drilling.
After earning its 50% interest, Aurizon would have the option to earn an additional 15% interest by:
- Making cash payments of $70,000 per year over a five year period, for an aggregate of $350,000;
- Incurring minimum work expenditures of $700,000 per year over a five year period, for an aggregate of $3,500,000; and
- Delivering a bankable feasibility study.
A field exploration program, built around a drill program on the Augossan Zones and the extension of the large scale exploration program started in 2010, was completed during the third quarter. To the end of September 2011, 53 drill holes on 400 metre widely spaced sections have been completed by percussion drilling, representing 4,934 metres. The drill pattern was developed to test polarization anomalies along a 6 kilometre area linked at surface with copper-gold-tungsten mineralization. In addition, 145 metres of channel sampling was completed to better understand the mineralization controls. Approximately 15% of the assay results had been received as at the end of September, 2011.
The prospecting part of the program was concluded with the collection of 2,530 grab samples. The area covered totalled approximately 400 square kilometres, and prospecting was guided by lake-bottom sediment anomalies. Approximately 40% of the assay results had been received as at the end of September, 2011.
Considering the large coverage distance between each point of interest, construction of a second camp has been budgeted for 2012 with some expenses incurred during the third quarter of 2011, including materials and transportation costs totalling $200 thousand. Year to date, total expenditures for the project are $4.7 million. Data compilation and geological interpretation activities are planned for the fourth quarter, 2011.
Aurizon may earn a 65% interest on the South Rex property which is located 145 kilometres east of Puvirnituk in the Nunavik region, of northern Quebec. The staked area comprises 2,061 claims covering approximately 89,800 hectares.
Information of a scientific or technical nature contained in this web site regarding the Rex South Property has been prepared under the supervision of Martin Demers, P. Geo., Exploration Manager of Aurizon and a Qualified Person under NI43-101.