Landore Resources Limited - Maiden Mineral Resource estimate and report BAM East Gold Deposit Junior Lake Property

(AIM Ticker: LND.L)

LONDON, Feb. 17, 2017 /CNW/ - Landore Resources Ltd. (AIM:LND) ("Landore Resources" or "the Company") is pleased to present the Maiden Mineral Resource estimate and report for the BAM East Gold Deposit on its Junior Lake Property, Ontario, Canada ("BAM East Gold Deposit").

Highlights:

• 301,000 ounces gold Maiden Resource Estimate for the BAM East Gold Deposit.
  
                                    
• One year from discovery to Maiden Resource Estimate. Discovery drill-hole 0415-517 drilled in December 2015. Resource cut-off 3^rd January 2017.
  
  
• US$5 per ounce of gold discovery cost with the drill success rate at 36 ounces of gold per metre drilled (8,436 metres total).
  
  
• 98 percent combined gold recovery by gravity concentration followed by cyanidation leach extraction of the gravity tail.
  
  
• Review by RPA has been successful in outlining the favourable BAM Sequence along a strike length of approximately five kilometres.  

Commenting on this report, Chief Executive Officer of Landore Resources, Bill Humphries, said:

"I am delighted to announce Landore's Maiden resource of 301,000 ounces of gold for our exciting BAM East Gold Deposit, which has been rapidly taken from discovery to resource in just one year.

Our remarkably low discovery cost further underlines the significant growth potential of the BAM East Gold Deposit. In addition, exploration drilling has succeeded in establishing the potential for the highly prospective Junior Lake Shear, which traverses Landore's Junior Lake Property from east to west, to host other gold occurrences.

Our work programme this year is aimed at further growth of the existing resource, discovery of further gold deposits along the Junior Lake Shear and progressing the BAM East Gold Deposit towards development by initiating a Pre-Feasibility study by year end.

This Gold discovery and its advancement is a remarkable achievement by Landore's Exploration team and is a testament to their dedication and perseverance in the exploration of the Junior Lake Property."

Extracts from NI 43-101 Technical Report on the BAM East Gold Deposit

"EXECUTIVE SUMMARY, BAM EAST GOLD DEPOSIT

Roscoe Postle Associates Inc. (RPA) was retained by Landore Resources Canada Inc. (Landore) to complete an initial Mineral Resource estimate for the BAM East Gold Deposit and to prepare a supporting Technical Report.  This Technical Report is compliant with the requirements of National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101).

Landore is a fully-owned subsidiary of Landore Resources Ltd., which is based in Guernsey and listed on the AIM market of the London Stock Exchange.  Landore has recently discovered the BAM East Gold Deposit within its Junior Lake Project, located approximately 235 km north-northeast of Thunder Bay, Ontario, and approximately 75 km east-northeast of the village of Armstrong Ontario, Canada. 

The Junior Lake Project consists of the newly discovered BAM East Gold Deposit along with two nickel-copper-platinum group element (Ni-Cu-PGE) deposits known as the B4-7/Alpha Zone Deposit and the VW Deposit.

Landore completed a drilling campaign in the fall of 2015, consisting of eight diamond drill holes for a total of 2,223 m.  Two of the eight drill holes were drilled to test a geophysical target located two kilometres to the east of the B4-7 Deposit.  The geophysical target drilling intersected a wide zone of gold mineralization close to surface that is now known as the BAM East Gold Deposit.  Landore has since carried out follow-up drilling programs in February 2016, in August 2016, and in October 2016.  These drilling programs have been successful in expanding the limits of the gold mineralization along the down-plunge direction.  In addition, the drilling programs have confirmed the presence of the mineralized controlling structure (the Junior Lake Shear Zone) along a total strike length of approximately 2,000 m by widely spaced drill holes.

The BAM East Gold Deposit is located in the south central area of the Junior Lake property and is interpreted as an Archean-aged mesothermal gold deposit.  The deposit consists of gold mineralization that is hosted by sheared and altered rocks of the Grassy Pond Sill and the BAM Sequence.  The deposit has been traced by detailed drilling at approximately 50 m centres and wider spaced drill holes at approximately 100 m centres along a strike length of approximately 600 m.  Reconnaissance-scale step-out drilling has also intersected gold mineralization in the same host rocks along a strike length of approximately 1,900 m.  Based upon the information collected from the detailed scale diamond drill holes, the host rock units strike in an east-southeast direction (average of azimuth 105°) and dip steeply to moderately to the south at 70° to 75°.  The gold mineralization is interpreted to reside within a series of tabular shaped zones that are oriented in a roughly en-echelon configuration and are generally parallel to the overall strike of the host rock units.  Six mineralized zones are currently recognized, and their estimated true widths of the mineralized zones range from 3.7 m to 9.4 m.  They have been traced by drilling from surface to a vertical depth of approximately 350 m.  The strike and depth limits of the mineralization remain undefined by the current drilling pattern.

The Mineral Resources for the BAM East Gold Deposit were estimated by RPA based on drill hole and assay data available up to January 3, 2017 and are summarized in Table 1-1. 

Conclusions

BAM EAST GOLD DEPOSIT
The BAM East Gold Deposit is a newly discovered gold deposit that has been partially defined by diamond drill holes.  A total of 43 drill holes that aggregate 8,436 m in length have been completed at this deposit to date.  The cut-off date for the drill hole database is January 3, 2017, which represents the date that the final assay results were received for drill hole 0416-560.  A small number of Screen Metallic assay results were received from the laboratory after the cut-off date.  These results were not received in time to be incorporated into the Mineral Resource, consequently the Fire Assay results for these samples were used to estimate the block grades.  The Screen Metallic assay results will be incorporated in future updates of the Mineral Resource estimate for the BAM East Gold Deposit.

The main stratigraphic sequence that is observed to host the large majority of the newly discovered gold mineralization at the BAM East Gold Deposit is referred to as the BAM Sequence.  The character of this package of rocks has been determined mostly from observations in drill core and in limited exposures in trenches and outcrops in the area.  In the immediate deposit area, the BAM Sequence is comprised largely of very fine grained to aphanitic material which has been recorded as clastic sedimentary unit in the drill logs.  It is typically a medium to dark green-grey to black colour, contains a weakly to strongly developed foliation, and is characterized by a soapy feel to the touch locally.  Characteristic sedimentary textures are generally not well developed in the immediate deposit area.  Preliminary geochemical characterization studies suggest that the sediments have been derived from precursor rocks of ultramafic composition.

The BAM East Gold Deposit is interpreted as an Archean-aged mesothermal gold deposit.  The deposit consists of gold mineralization that is hosted by sheared and altered rocks of the Grassy Pond Sill and the BAM Sequence.  The gold mineralization is commonly observed in drill core to exist as visible gold that is hosted by very thin, foliation-parallel quartz-rich veinlets, hosted by highly fissile ultramafic sediments of the BAM Sequence, or by foliated rocks of the Grassy Pond Sill.  A preliminary petrographic study carried out on a number of samples has identified the presence of coarse native gold that is present in association with an unidentified silvery mineral that occur within calcite replacement patches and veinlets.

Apart from the fissile nature observed in the ultramafic sediments, little traditional megascopic alteration (sericite-ankerite), hydrothermal sulphide deposition (pyrite-pyrrhotite-chalcopyrite-arsenopyrite) or large-scale quartz veining is observed associated with the mineralized rock units of the BAM Sequence.  Within the host rocks of the Grassy Pond sill, the alteration is characterized by both a partial or complete destruction and replacement of both the primary plagioclase phenocrysts and the interstitial material.  Megascopic observations suggest that the main alteration signature is represented by a light grey-green to black colour that is believed to represent the formation of either Mg-rich chlorite or Fe-rich chlorite, respectively.  Narrow zones of intensely developed foliation are present on occasion.  All primary rock textures are completely destroyed within these zones and are replaced with an alteration assemblage of chlorite-silica-carbonate(?).  The specific nature of the carbonate alteration (calcite/dolomite/ankerite) has not been determined. 

ALS Metallurgy Americas was engaged by Landore in December 2016 to carry out a preliminary assessment of the metallurgical response of two composite samples from the BAM East Gold Deposit.  The focus of the test program included an assessment for gold recovery through combined gravity concentration and cyanidation bottle roll leaching of the gravity tails at a single primary grind of 75 µm K₈₀.  Between 98% and 99% of the feed gold was recovered through combined gravity concentration and cyanidation leaching of gravity tails for the two composites tested.  Gold leach kinetics was fast, with most of the gold extraction taking place within the first six hours.  Sodium cyanide and lime consumption averaged approximately 0.1 kg/t and 0.3 kg/t, respectively.  Gold head grades were calculated at 2.0 g/t for both composites based on combined gravity and cyanidation leach test results.

RPA constructed a grade-block model by applying a capping value of 15 g/t Au to all samples contained within the mineralized wireframe domains, and by compositing the capped samples to an equal length of one metre.  The average bulk densities of the three host lithologies were estimated using the information collected by Landore.  The average bulk density for the BAM Sequence and the Grassy Pond Sill is 2.82 t/m³ and 2.84 t/m³, respectively.  The average bulk density of the Marshall Lake group is 2.92 t/m³. 

The distribution of the gold grades, grade times thickness (GT) product, and estimated true width were examined for each of the mineralized domains by preparing contoured longitudinal projections using the contouring function available in the Surpac software package.  The results suggest that the gold grades in Zone 402 are preferentially oriented as shoots that plunge steeply to the east.  The gold grade distributions for the remainder of the zones are not as well defined, and appear to occur as smaller-scale pockets of elevated grades.  Additional drill hole information will be required to fully outline the distribution with accuracy.

An upright, rotated, sub-blocked model with the long axis of the blocks oriented along an azimuth of 105º (i.e., along the strike of the stratigraphy and the mineralization) was constructed using the Surpac v.6.7.3 software package.  The selected block sizes were 3.0 m by 5.0 m by 5.0 m (width, length, height).  One level of sub-blocking was applied to a minimum size of 1.5 m x 2.5 m x 2.5 m.  Gold grades were interpolated into the individual blocks for the mineralized domains using two interpolation methods:  inverse distance cubed (ID³) and nearest neighbour (NN).  The gold grades estimated using the ID³ algorithm are used to report the Mineral Resources. 

GOLD EXPLORATION POTENTIAL
Compilation activities by RPA have been successful in outlining the favourable BAM Sequence along a strike length of approximately five kilometres.  The strike limits of the unit have not been defined.  Additional work is clearly warranted.  This work would include continued compilation of all available information, detailed geological mapping and geochemical sampling, stripping and trenching activities in areas of shallow overburden, and diamond drilling in areas of deeper overburden cover.

NI-CU-PGE EXPLORATION POTENTIAL
RPA is of the opinion that there is good exploration potential to discover more Ni-Cu-PGE mineralization on the property.  RPA concurs, however, with Landore's current focus on gold.

RECOMMENDATIONS
RPA has the following recommendations for a work program and budget to advance the Project to the next decision stage.  Overall, RPA is of the opinion that there is excellent exploration potential remaining to expand the limits of the BAM East Deposit and to discover zones of additional gold mineralization along the Junior Lake Shear Zone.  RPA's recommendations for the BAM East Deposit include:

1. Carry out exploration activities to search for the eastern extension of the BAM Sequence beyond approximately Section 36+00 E.  These activities would involve detailed re-mapping of the outcrops located along the projected eastern strike extension of the unit, stripping and trenching over areas of shallow overburden in this area, and completion of additional geophysical surveys (magnetometer and HEM surveys) to the east of Line 40+00E.  Expansion of the geophysical survey coverage to the west of the limits of the current coverage is also warranted.
   
   
2. Continue compilation activities in the current area of coverage and expand the area of coverage, especially along the western projection of the current known limits of the BAM Sequence.  These compilation activities are important tools to help understand the various geological settings and the relationships with the mineralization found on the property.  These compilations are also important tools for generating exploration targets.
   
   
3. Carry out a deportment study to examine the particle size distribution of the native gold particles.  This information will be useful in establishing accurate sample preparation and analyses protocols and will also be useful when establishing a metallurgical testing program.
   
   
4. Carry out assay-by-size studies to examine the relationship between the particle size and the grade of a given sample.  Assay-to-extinction studies will also be useful in understanding the impact of the aliquot size on the variability of the assay result for a given sample.
   
   
5. Adopt the use of potassium ferricyanide stain on a regular basis to test for the presence of micro-scale ankerite alteration.
   
   
6. Carry out a program of preliminary metallurgical testwork to evaluate the merits of possible flow sheets for processing of the BAM East Deposit.
   
   
7. Determine the bulk density of the overburden materials for use in future block models and for mine planning purposes.
   
   
8. Complete in-fill drilling to clearly define the location and extent of the gold mineralization.  This drilling information will permit a more accurate estimate of the grade distribution at the local scale, improve the confidence of the estimate, and improve the confidence of any production schedules and cash flow models that are based on the Mineral Resource estimate.
   
   
9. Carry out additional drilling to define the strike and down-dip limits of the mineralized zones.
   
   
10. Investigate the utility of using a dynamic search ellipse strategy to improve the accuracy of the local estimate as additional detailed drill hole information becomes available.

PROPOSED WORK PROGRAM
RPA concurs with Landore's proposed two phase work program on the BAM East Gold Deposit.  The Phase 2 work is contingent on the Phase 1 results (Table 1-2)."

"TECHNICAL SUMMARY

PROPERTY LOCATION AND LAND TENURE
The Junior Lake Project is located approximately 235 km north-northeast of Thunder Bay, Ontario, and approximately 75 km east-northeast of the village of Armstrong.  The centre of the Project is located at 87º59'4"W longitude and 50º23'9"N latitude; the NAD83 UTM coordinates (Zone 16) are 430,000E and 5,580,000N.  The BAM East Gold Deposit is located at approximately UTM coordinate 434,910E and 5,581,555N, the B4-7 Deposit is located at approximately UTM coordinates 432,660E and 5,581,310N, and the VW Deposit is located at approximately UTM coordinates 435,700E and 5,580,800N.  Landore's mineral holdings in the Armstrong area consist of 90 staked mineral claims (1,173 units totaling 18,768 ha), two patented claims and three mining leases, all together totaling 22,497 ha.

The mining leases include mining and surface rights over the area encompassing the BAM East, B4-7 and VW Deposits. The leases cover 23 mineral claims and two patents for a total area of 3,729 ha and have been granted for 21 years renewable for further terms of 21 years.

Within the mining leases, Landore has the right, subject to provisions of certain Acts and reservations, to:

• Sink shafts, excavations etc., for mining purposes
• Construct dams, reservoirs, railways etc., as needed, and
• Erect buildings, machinery, furnaces, etc. as required and to treat ores

ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY
Road access to the Junior Lake property from Thunder Bay is via paved provincial highways No. 17 (15 km) and No. 527 to Armstrong, with an overall distance of 255 km.  From Armstrong, the Buchanan Forest Products Inc. gravel haulage road (BHR) is taken east to kilometre 105, where a skidder haulage road leads approximately two kilometres to the Landore Camp.  In all, the combined distance from Thunder Bay to the property is approximately 360 km.

Thunder Bay is the major centre for northwestern Ontario and provides most of the services required by exploration and mining operations.  The Thunder Bay commercial airport has daily scheduled service to major Canadian cities, and the city offers rail facilities and a port on Lake Superior that provides Atlantic Ocean access via the Great Lakes and the St. Lawrence Seaway.  Mining and skilled labour are available in Thunder Bay and elsewhere in Ontario and Québec.  The nearest operating mine is the Lac Des Iles Mine (LDIM) owned by Lac Des Iles Mines Ltd., a subsidiary of North American Palladium Ltd. (NAP).  LDIM is located 100 km north of Thunder Bay, approximately 15 km west of Highway 527, and is approximately 259 km by road from the Junior Lake property.

Other than a cabin camp, there is no infrastructure on the property.  With the bankruptcy of Buchanan Forest Products Inc. in May 2009, maintenance of the pulp haulage road to the Junior Lake property has been assumed by the Ontario Ministry of Transportation to within 30 km of the camp site, with the balance of the distance maintained by private interests.  The Canadian National Railway (CNR) main single line is 13 km south of the property, passing between Junior Lake and the north shore of Lake Nipigon.  The property is of sufficient size to support any potential mining scenarios.

HISTORY
Geological mapping and exploration in the vicinity of the Junior Lake property is recorded as early as 1917.  In 1968, Canadian Dyno Mines Limited staked 333 claims in 15 groups to cover conductors detected by an airborne electromagnetic (EM) and magnetic (MAG) survey.  Eight diamond drill holes totaling 674.8 m were drilled to test conductors in January 1969, resulting in the discovery of the B4-7 sulphide zone.  The B4-7 Deposit was delineated by an additional 30 holes (6,850 m, or 22,479 ft) in 1969.

Landore optioned part of the property from North Coldstream Mines Limited in 1998 and additional claims from Brancote Canada in 2000.  In 2005, the VW Ni-Cu-Co-PGE deposit was found by Landore as a result of drill-testing a promising geophysical target.  The BAM East Deposit was discovered in the fall of 2015 as a result of drilling a geophysical target located two kilometres to the east of the B4-7 Deposit.

GEOLOGY AND MINERALIZATION
The property is within the roughly east-west trending Caribou (Lake)-O'Sullivan greenstone belt.  This greenstone belt ranges from 3.5 km to 15 km wide and extends roughly east-west for 80 km to 100 km.  The supracrustal rocks, and associated mafic to ultramafic intrusions, of the Caribou (Lake)-O'Sullivan greenstone belt are subdivided by Berger (1992) into the Archean-aged Toronto Lake Group (TLG) and Marshall Lake Group (MLG).  The two groups are separated by a series of discrete zones of intense shearing that form a corridor of up to 800 m wide.  This zone is referred to on the property as the Junior Lake Shear Zone, which may be part of a regional-scale structure.  The TLG underlies the southern third of the Junior Lake property and consists of a bimodal assemblage of tholeiitic mafic flows and calc-alkaline rhyolitic to dacitic tuff, tuff breccias, and subordinate flows.  In the northern portions of the Junior Lake property, the MLG includes tholeiitic, amphibolitized mafic flows and calc-alkalic dacitic tuff, minor tuff breccias, and intercalated greywacke, chert, and sulphide iron formation.  Relative ages based on superposition and pillow tops indicate that the two sequences young to the north.

The main stratigraphic sequence that is observed to host the large majority of the newly discovered gold mineralization at the BAM East Gold Deposit is referred to as the BAM Sequence.  The BAM Sequence is located in contact with the MLG to the north and the Grassy Pond Sill (a member of the TLG) to the south.  The character of this package of rocks has been determined mostly from observations in drill core and in limited exposures in trenches and outcrops in the area.  In the immediate deposit area, the BAM Sequence is comprised largely of very fine grained to aphanitic material which has been recorded as clastic sedimentary unit in the drill logs.  It is typically a medium to dark green-grey to black colour, contains a weakly to strongly developed foliation, and is characterized by a soapy feel to the touch locally.  Characteristic sedimentary textures are generally not well developed in the immediate deposit area.  Preliminary geochemical characterization studies suggest that the sediments have been derived from precursor rocks of ultramafic composition.  Numerous small-scale dikes of mafic, intermediate, and felsic composition are present in the deposit area.

DRILLING
The drilling programs carried out in 2015 and 2016 were conducted by Chibougamau Diamond Drilling, of Chibougamau, Québec.  In 2015, 16 drill holes were completed for a total length of 4,813 m.  In 2016, a total of 42 drill holes were completed for a total length of 8,319 m.  To date, a total of 791 drill holes totaling 169,786 m in length have been completed on the Junior Lake property.  These drill holes comprise delineation and in-fill drill holes on the BAM East, B4-7, and VW Deposits, delineation drill holes on the Lamaune area, exploration drill holes, and a small number of drill holes completed to generate material for metallurgical testing.

MINERAL RESOURCES
RPA's Mineral Resource estimate for the BAM East Deposit is based on data available up to January 3, 2017.

Given the shallow nature of the mineralization and the initial metallurgical test results, RPA agreed with Landore's opinion that the material would be extracted by means of open pit mining methods and processed using conventional milling techniques.  The Mineral Resource estimate for the BAM East Deposit is based on the information from 43 drill holes that totalled 8,436 m in length.  These drill holes include the two discovery holes completed in 2015 (0415-417 and 0415-518) along with the channel sample results from Trench 0416-01T.  The Mineral Resources for the BAM East Deposit are reported using a block cut-off grade of 0.3 g/t Au for those blocks that lie above a resource pit shell, which was developed using the Whittle software package.  The Mineral Resources within the base case open pit shell are estimated at 4.45 million tonnes at an average grade of 1.35 g/t Au containing 193,000 ounces of gold in the Indicated Mineral Resource category and 2.73 million tonnes at an average grade of 1.23 g/t Au containing 108,000 ounces of gold in the Inferred Mineral Resource category.

RPA is not aware of any environmental, permitting, legal, title, taxation, socio-economic, marketing, political, or other issues that could materially affect the Mineral Resource estimates.

ENVIRONMENTAL STUDIES
Landore has conducted various environmental baseline studies on the Junior lake property since 2007. Surface water sampling of various lakes and streams has been conducted since 2007. Bathymetry and fish habitat studies of Ketchikan Lake were conducted in 2007. In 2008, a bedrock surface investigation of the northern portion of Ketchikan Lake was completed together with terrestrial and aquatic studies. The environmental and baseline studies are all pre-requisites for permitting requirements for the development of the BAM East Gold Deposit.

FIRST NATIONS RELATIONS
Landore maintains a sound working relationship with First Nations on whose traditional lands the Junior Lake property is situated. In 2007, Landore signed a Memorandum of Understanding (MOU) with Whitesand and AZA First Nations. This agreement formalizes the desire and commitment to develop a positive, mutually beneficial relationship amongst all parties and establishes the process by which this is to be accomplished while Landore is conducting exploration and advanced exploration activities in the area.

The MOU was later revised to reflect significant changes in Landore's claim holdings in the Junior Lake area. Whitesand signed the revised MOU on April 30, 2012. AZA signed the revised MOU on December 6, 2013."

End of Extracts

The full Technical Report with results and a new corporate presentation are available on Landore Resources' web site www.landore.com

PLANNED WORK AND BUDGET 2017:

The 2017 work programme will focus on the BAM East Gold Deposit with a total of 16,000 metres of drilling in two phases:

Phase 1

• 5,000m of HQ diamond core to upgrade the Inferred Mineral Resource to the Indicated category and to expand the existing resource to the east and west and down dip.
• 7,500m of NQ diamond core to advance the zones already identified along the 1,900 metres of the Junior Lake shear and to explore possible extensions of the shear zone along strike to the east and west.
• Exploration including mapping, trenching and geophysics to cover possible extensions of the Junior Lake shear
• Studies including Metallurgical, Geotechnical for pit design and continuation of base line studies.
• Upgrade of Resource.

Phase 2

• 3,500 metres of HQ diamond core to upgrade the east section Mineral Resource estimate of the Central Zone from Indicated to Measured category for a potential starter pit operation.
• Commence Pre-Feasibility studies with the appointment of Project Management and engineering staff for mine design, plant design, opex/capex estimates etc.

Proposed Operations budget, Landore Canada, for the above program is:

The Board intends that funding for the proposed work programme will be raised via an equity subscription by existing and new investors at or around market price, seeking to raise between £3 to £4.5 million and to be completed within the next month.                                                                              

Reno Pressacco, (P.Geo.), Principal Geologist of RPA Inc. Toronto, Canada, a Qualified Person as defined in NI 43-101, and responsible for the preparation of the BAM East Gold Deposit Resource Estimate, has reviewed and verified all scientific or technical disclosure relating to the Mineral Resource estimate and exploration potential.

Michele Tuomi, (P.Geo., BSc. Geology), Director/VP Exploration of Landore Resources Canada Inc. and a Qualified Person as defined in the Canadian National Instrument 43-101 and the AIM Rules for Companies, has reviewed and verified all scientific or technical mining disclosure contained in this announcement.

About Landore Resources
Landore Resources is an exploration company that seeks to grow shareholder value through the acquisition, exploration and development of precious and base metal projects in eastern Canada. The Company is primarily focused on the development of the Junior Lake Project. Landore Resources has mineral rights to 5 properties in eastern Canada. The Company is headquartered in Guernsey, with an exploration office located in Thunder Bay, Ontario, Canada.

This announcement contains inside information as defined in Article 7 of the Market Abuse Regulation No 596/2014.

SOURCE Landore Resources Ltd.