- Recently acquired prospective gold and base metals claims in Ontario
- Owns a large kimberlite-bearing land package in Australia
- Experienced management team
What Lithoquest Resources does:
Newly-refocused Lithoquest Resources Inc (CVE:LDI), formerly Lithoquest Diamonds Inc, changed its name in late 2020 after placing its North Kimberley Diamond project in Western Australia on care and maintenance in July until financing conditions improve in the diamond industry.
At the time, the Vancouver, British Columbia-based company said it was actively reviewing other mineral projects with the objective to secure, through acquisition or joint venture, one or more projects that offer significant discovery potential.
Lithoquest noted that preference would be given to projects located in stable jurisdictions, containing gold and copper, however, other mineral commodities are also being considered.
The company’s 100%-owned North Kimberley project consists of three licences and covers 1,500 square kilometres (km), which lie in the northern portion of the flat-lying Kimberley Plateau about 65 km east of the community of Kalumburu. The Gibb River and Kalumburu roads provide ground access to the project, which is also on tidewater.
Significantly, Lithoquest has already found kimberlites - the primary source rocks for diamonds - there and the company believes the project is host to a field of these diamond-bearing volcanic pipes.
Lithoquest Resources is led by CEO Bruce Counts, who has more than 25 years of experience in international diamond exploration, while having served over 16 years as a director and senior officer of publicly-traded mineral exploration companies. He was directly involved in the discovery of several kimberlite fields including the Lac de Gras field, which is host to the Ekati Diamond Mine in Canada’s Northwest Territories.
How is it doing:
In May, Lithoquest announced an option agreement with Landore Resources Canada Inc to acquire a 100% interest in the Miminiska Gold Project and the Keezhik Gold Project, both of which are located in northwest Ontario.
The company said the projects are situated within the Miminiska-Fort Hope greenstone belt and host drill-confirmed gold mineralization that is similar in style to the nearby Musselwhite gold mine owned by Newmont Mining Corporation (NYSE:NEM).
Included in the option agreement is an extensive exploration database with more than 40,000 metres of historical drilling results.
Lithoquest noted that the historical data suggests that there is potential on both projects to expand the known zones of gold mineralization, as well as make new discoveries.
In order to acquire both projects, Lithoquest is required to pay Landore about C$1.4 million in cash, plus $2.7 million in either cash or stock in staged payments over a 24-month period.
As well, Landore will retain a 2% net smelter royalty (NSR) on both projects, although Lithoquest can buy back 1% of the royalty by paying Landore $1 million at any time.
Meanwhile in March, Lithoquest closed a non-brokered private placement consisting of 2,980,000 company units, at a price of $0.08 per unit, for gross proceeds of $238,400. The company said it plans to use the proceeds from the offering for working capital purposes.
In late 2020, Lithoquest revealed it had acquired, via staking, the under-explored Attwood project in Ontario, which is prospective for gold and base metals.
The project sits in the Fort Hope greenstone belt and encompasses 1,151 claims covering 23,262 hectares (Ha).
It lies about 320 km north of Thunder Bay and within 5 km of an all-weather forestry road and is accessible by float plane from the community of Armstrong.
Lithoquest has compiled a database of existing information and aims to complete a detailed airborne magnetic survey ahead of a prospecting and geochemical sampling program in 2021.
A regional lake and stream sediment sampling program carried out by the Government of Ontario in 2000 showed anomalous gold, copper, nickel, and molybdenum values at numerous locations on the property.
This is significant given the poorly drained nature of the project area, the company said.
Also, a government-sponsored airborne survey flown in 2001 identified numerous iron formations and several strong bedrock conductors on the property.
The staking of the Attwood project is part of Lithoquest's ongoing process to actively review projects in a bid to secure through acquisition or joint venture, one or more of which offer significant discovery potential.
Inflection points:
- News flow from Attwood property exploration
- North Kimberley project provides upside to a recovering diamond market
What the boss says:
Commenting on the company’s option agreement to acquire the Miminiska and Keezhik gold projects, Lithoquest Resources CEO Bruce Counts said in a statement: “Large land packages with extensive gold mineralization, a significant historical database and excellent discovery potential are rarely available. The company has assessed many gold projects in the last 12 months and these properties stood out as an exceptional opportunity to add value for investors.”
Counts added: “Lithoquest intends to immediately evaluate the existing data prior to conducting field work on both projects in the summer of 2021. The field work will provide a foundation for a drill program in early 2022.”
Contact Sean at sean@proactiveinvestors.com