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Widened Gold Vein, NI-Compliant Report and Digging Into Jersey Mine Tailings; All in a Week’s Work at Margaux

Margaux Resources is hitting on all cylinders with steady news flow from developments on the properties.

It is well understood that developments in the mining industry can go relatively slow; that’s the nature of the beast. After all, it’s hard to go hell-for-leather when there is so much involved with drilling, sampling, geological surveys, etc. that are all integral to building new mining operations. This may be the case if a company has a thin portfolio, but after consolidating properties in the richly mineralized Kootenary Arc region in southeastern British Columbia late last year, Margaux Resources (MRL:CA)(MARFF) is hitting on all cylinders with steady news flow from developments on the properties.

Cumulatively, Margaux controls more than 19,000 hectares across its six properties, with claims extending about 30 kilometers further to the north.

In just six days this month, Margaux said that it has extended the gold vein at one project, filed a National Instrument 43-101 technical report for another and inked an agreement to assess the tungsten tailings from the once-mighty Jersey-Emerald mine that was shuttered in 1970.

More Gold

In an update on its Bayonne and Jackpot properties on Sept. 7, the Calgary-based explorer said that it extended the past-producing main gold vein at Bayonne 50 meters past where historic mining stopped. It obtained chip and grab samples over one meter from the main vein, graded 24.6 grams per tonne (g/t) and 43.6 g/t, respectively. These finds align with the type of high-grade gold found during previous mining that included 81,782 tonnes at an average grade of 16.0 g/t gold and 45.9 g/t silver.

Other finds supporting the extension, which now gives the vein system a strike length of one kilometer, included 43.6 g/t gold from the 0.5 to 0.75-meter-wide vein from an outcrop, indicating a strong gold presence near the surface. That also dovetails with historic works, given that mining did not exceed a depth of 150 meters from the surface. That means the possibilities of high-grade gold can exist in all directions in the vein.

These results are pretty much what the company expected. In the announcement of the successful exploration, Margaux CEO and President Tyler Rice stated, “The current 4,500m drill program across three of the Company’s properties, teamed with continued high-grade discoveries on the surface, marks a progression of knowledge and success that Margaux envisioned when it originally consolidated the Kootenay Arc Zinc-Gold asset package.”

Most recently, Margaux reported additional high-grade gold samples at Bayonne, specifically from the Maggie Aikens vein. On Sept. 18, the company reported high-grade results, including 51.6 g/t Au and 46.6 g/t Au, with six holes totaling 475 metres completed at the Maggie Aikens target.

The B.C. Ministry of Energy and Mines has approved a permit for drilling on Bayonne, with the rigs mobilized and a 1,500-meter drill program set to begin any day now to further delineate the mineralization at the property.

Also in the gold portfolio, Margaux said on Sept. 11 that it filed on SEDAR the independent NI 43-101 Technical Report for its Sheep Creek property located in the historic Sheep Creek gold camp as part of the broader Kootenay Arc project outside of Salmo. Margaux is revitalizing the property that had historic production of 736,000 ounces of gold at an average grade of 14.7 g/t Au, from 34 discrete veins. Cut-off grades for the property were a staggering 8 g/t gold, a level that most miners would love to see at the high end of the range.

Margaux has been active at the project this year, conducting surface sampling that has returned grades of 71.5 g/t gold and 17.75 g/t gold, as well as identifying a new high-grade vein at Sheep Creek. At the new vein, rock samples have returned high-grade gold-silver-lead-zinc mineralization, including samples showing 36.4 g/t Au, 1,021 g/t Ag, 33.68% Pb and 13.62% Zn.

An initial drill program is planned this fall to better define the resources at Sheep Creek.

More Zinc, More Lead

At the nearby Jackpot project to the northwest, Margaux is building upon 143 historic drill holes (11,000m) and two levels of underground workings that explored a zone of complexly folded lead-zinc mineralization. A nine-hole, 1,400-meter drill program was recently completed, testing a 750m x 1,000m area for zinc-lead mineralization. Results are expected by the end of the month.

In the meantime, more rock samples were collected during geological mapping. The goal was to further validate historic trenching data that returned as high as 13.35% zinc over 3.4 meters. In a neighboring area, grab samples returned up to 12.5% lead with 43.2 parts per million of silver.

The latest rock samples lend further credence to mineralization, as suggested by two meters averaging 16.4% zinc and 35.4 ppm lead, with trace amounts of gold and silver.

More Tungsten Too?

On Sept. 13, Margaux announced it has signed a term sheet with CRONIMET Mining Processing AG, for which the companies agreed to perform a preliminary assessment regarding the economic feasibility of recovering minerals left behind in the historic tungsten tailings from the Jersey-Emerald mine adjacent to Sheep Creek and south of Jackpot. The Jersey-Emerald mine has a rich history, at one point clocking in as the second-largest zinc-lead mine in British Columbia and the second-largest tungsten mine in North America. Producing from approximately 1944 to 1970, about 1.4 million tonnes of tailings were deposited on the site. Of course, there are no assurances of any mineral recovery, but modern techniques present an opportunity worth exploring to potentially reprocess the tailings to inexpensively (relative to hard rock mining from scratch) collect the valuable minerals still trapped inside while cleaning up the environment.

Margaux has already been working with the Salmo Watershed Streamkeepers Society on their Rapid Assessment Rapid Remediation approach to better characterize the tailings. Moving forward with the initiative, Margaux has shipped about 3,500 kilograms of tailings from various spots on the site to CRONIMET for processing and analysis as part of a lab-scale test campaign. If the output is successful, a 10,000-tonne pilot scale campaign will be initiated.

CRONIMET is taking an active role in the project with a three-year option to acquire a 25% working interest. This will include sharing in any potential future revenue, while also being required to proportionately fund the development of the pilot and recycling project.

Moving With a Purpose

With tungsten prices climbing 50% since July, zinc prices rising 50% in the last year, lead prices up over 20% since last September and gold and silver prices uptrending in 2017 after years of headwinds, Margaux jumped on the opportunity to aggregate an incredible set of properties under one umbrella last year that addresses all of these markets. Under the guidance of a seasoned management team, they are efficiently checking all the requisite boxes for development of these properties for near-term and sustainable production for years to come by tapping into the known resources and chalking out the mineralization that remains virgin soil. Even so, Margaux has been largely underappreciated by the mining community; however, as property developments continue to unfold, this trend seems unlikely to continue.

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