Mainstream Minerals enters into an option agreement to acquire Birch Lake property, Red Lake Area of Northwestern Ontario
(via Thenewswire.ca)
April 20th, 2011 - Winnipeg, MB - Mainstream Minerals Corporation (TSX.V: MJO) ("Mainstream") is pleased to announce the acquisition of the Birch Lake property via option agreement. The Birch Lake property is comprised of two non-contiguous groups of mining claims covering 1,440 hectares. The south-eastern claim group (four claims covering 704 hectares) sits between, and contiguous to, Gold Canyon Resources Inc.'s (TSX.V: GCU) Springpole Gold Project and Pelangio Exploration Inc.'s (TSX.V: PX) Birch Lake property. The north-eastern claim group (six claims covering 736 hectares) is contiguous to Pelangio Exploration Inc.'s Birch Lake property.
The Birch Lake property under option by Mainstream is situated in the north-eastern portion of the Birch-Uchi Greenstone Belt within the Uchi Subprovince of the Archean Superior Province. Prospective Balmer assemblage and Confederation assemblage volcanic, with mafic intrusive and metasedimentary rocks have all been mapped on the property by the Ontario Geological Survey.
The discovery of gold at Red Lake in 1925 brought prospectors into the Birch Lake area with visible gold first discovered north of the Birch-Springpole portage in 1928. Gold Canyon currently recognizes at least four different styles of gold mineralization on its Springpole Gold Project in eight different zones and continues to report spectacular drill results including 100.5 metres at 7.23 grams per tonne gold (330 feet at 0.211 oz per ton gold) in hole SP11-040, a vertical infill hole testing the mid-section of the Portage Zone (see Gold Canyon's press release dated March 15th, 2011). It should be noted that the true width of this zone has yet to be determined and several of Gold Canyon's drill holes ended in mineralization.
Exploration completed on Pelangio's Birch Lake property is dominated by work by Dome Exploration (Canada) Ltd. (later Placer Dome) in the 1980's. The Birch Lake area was identified as highly favourable for gold bearing iron formations. Placer Dome delineated a gold bearing system on High Grade Island over a strike length of approximately 300 metres to a vertical extent of 150 metres. Placer Dome drilled 110 holes totalling 19,918 metres. Approximately 2,000 metres were drilled on the property between 2003 and 2008, including significant high grade intercepts of 115.89 g/t Au over 2.9 metres and 229.96 g/t Au over 2.45 metres.
Historical work on the optioned Birch Lake property is minimal, though there are several documented gold occurrences (Ontario Geological Survey Open File Report 5835). Most noteworthy is the Dome-Birch Lake prospect where gold occurs on the southwest shore of a small island, southeast of Johnson Island. This occurrence consists of quartz-carbonate veins in chert-magnetite iron formation. The veins contain pyrite, chalcopyrite and visible gold. Airborne magnetics and electromagnetics by Cangold in 2003 identified what appears to be tightly folded iron formation in the north-eastern portion of the claim block. Structural studies in 1996 by Placer Dome on Pelangio's High Grade Island prospect resulted in recommendations of surface exploration to the southeast of the Main Central Zone (toward Mainstream's property) in an area that magnetic data indicates more complex structural geology. Northwest-southeast trending areas of high resistivity conformable to those identified on High Grade Island by Placer Dome in 1995 also fall on Mainstream's portion of Keigat Island (part of the North-western claim group) roughly 1,200 meters along strike to the Southeast of the High Grade Island prospect.
A detailed digital compilation of all geological and geophysical data on and surrounding Mainstream's Birch Lake property is underway. The compilation will form the base for identifying the prospective gold bearing areas.
Mainstream's President and Chief Executive Officer, Michael Romanik, says: "Securing the Birch Lake property between, and contiguous to, Gold Canyon Resources Inc.'s Springpole Gold Project and Pelangio Exploration Inc.'s Birch Lake property is a direct result of the strong relationships we have built with geotechnical experts well-versed in the Red Lake area. It is another step toward Mainstream becoming a strategic player and landholder in the Birch-Uchi Greenstone Belt at a time of greatly renewed interest in the area."
Under the terms of the option agreement (the "Agreement"), Mainstream can earn a 100% interest by completing payments to the Vendor totaling $100,500 over 5 years and the issuance of 200,000 common shares as follows:
Upon signing of the Agreement $12,500
1st Anniversary of the Agreement $12,000
2nd Anniversary of the Agreement $16,000
3rd Anniversary of the Agreement $25,000
4th and Final Anniversary of the Agreement $35,000
Within 10 days of receiving regulatory approval
of the Agreement 200,000 common shares
The issued shares shall be subject to hold periods as required by the applicable policies of the TSX Venture Exchange and applicable securities laws.
The vendor will retain a 2.0 % Net Smelter Return (the "NSR") interest in the Property. Mainstream can buy back one half or 1% of the "NSR" at any time by paying the vendor $1,000,000 CDN dollars.
Garry Clark, P.Geo is the Qualified Person on this project pursuant to National Instrument 43-101 and has reviewed and approved the technical disclosure in this press release.
About Mainstream Minerals
Mainstream Minerals Corporation is a mineral exploration and development company focused on precious metals mining properties with economic potential, with the aim of bringing such properties to commercial production. The Bobjo Mine, Slate Lake, Fly Lake and the past producing Hudson Patricia Mine projects are located in the prolific Red Lake Gold Camp in northwestern Ontario. The Rowan Lake project covers 12.5 kilometres on the Cameron Lake-Pipestone Fault in the Kenora Mining District. Other projects include the Price and West Keefer Claims located in the West Timmins area in north-central Ontario and the Casa Berardi Claims in northern Qu?c.
MJO Shares Outstanding: 52,637,130
ON BEHALF OF THE BOARD
Signed "Michael Romanik"
Michael Romanik, President & CEO
(204) 222-0137
info@mainstreamminerals.com
www.mainstreamminerals.com
This news release includes certain forward-looking statements concerning the future performance of Mainstream Mineral Corporation's business, its operations and its financial performance and condition, as well as management's objectives, strategies, beliefs and intentions. The Company does not intend, and does not assume any obligation, to update these forward-looking statements. Forward-looking statements are frequently identified by such words as "may", "plan", "expect", "anticipate", "estimate", "intend" and similar words referring to future events and results. These forward-looking statements represent management's best judgment based on current facts and assumptions that management considers reasonable. The Company makes no representation that reasonable business people in possession of the same information would reach the same conclusions. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the speculative nature of mineral exploration and development, fluctuating commodity prices, competitive risks and the availability of financing and as described in more detail in the Company's recent securities filings available at www.sedar.com. Actual events or results may differ materially from those projected in the forward looking-statements and readers are cautioned against placing undue reliance thereon.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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