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Falcon Signs MOU, Patented Mining Land - Central Canada Project

Apr 23, 2020

FALCON GOLD CORP. is pleased to announce it has entered into a MOU to acquire 2 large patented claim blocks from Great Lakes Exploration Inc. ("GLE"). The transaction includes 476 hectares of patented mining claims including patented surface rights. The patented lands lie along strike of Falcon's Central Canada Project. The claims cover 8,400 meters of strike length of mineralized magnetite-sulphide lenses varying from less than 10 to greater than 40 meters in width. 

Past exploration by Monteagle Explorations Ltd., Kemins Exploration Ltd., and Paulpic Gold Mines including airborne and ground geophysics, has outlined various anomalies which indicate potential untested extensions of base metal magnetite mineralization. These zones were initially targeted in the early to mid-1900's for iron ore potential by the Oliver Mining Company and others, and wide spaced drilling confirmed the thickness and continuity of the zones as well as the presence of associated base metals (Cu, Ni, and Co) in addition to the targeted magnetite. 

On the western end of the claim group, drilling by the Hanna Mining Company tested a 1,500-meter-long magnetic conductor and encountered multiple horizons of massive sulfide and magnetite mineralization with intercepts up to 12.6 meters with Cu grades up to 0.75% and Co grades up to 0.14%. 

The properties lie along strike of Falcon's Central Canada Gold project and the Quetico Fault. This trend hosts significant gold mineralization identified by both Falcon and past operators. The lithologies and structure outlined by Monteagle, Steep Rock Iron Mines, and Great Lake Resources also suggests a strong correlation with gold mineralization observed on the Central Canada Project. Multiple geophysics and alteration targets have been identified for follow-up gold exploration.

In the central portion of the claims, historic drilling and surface trenches tested a portion of a 1,900-meter-long magnetic and conductive anomaly, and encountered thick sections of massive sulfide and magnetite, with up to 41 meters of drilled zone intercept and Cu grades up to 0.61% and Co grades up to 0.15% in surface trenches. Although Ni and Co grades were not reported in historic drilling, surface sampling by GLE and the Ontario Geologic Survey returned significant grades of Ni up to 0.37% and Co up to 0.24%. 

In 1940, Steep Rock Iron Mines Ltd. examined both the western and central portions of the claims, and estimated a historic tonnage of approximately 9,823,000 million tons of sulfide rich iron ore. This historic tonnage estimate incorporated only the strongly magnetic portions of the trend targeted for iron ore, not including an additional 3,400 meters of untested potential. 

A large portion of the central and eastern portions of the optioned claims has not been drill tested and is largely unexposed, but airborne and ground geophysics indicate probable continuity across 4,800 meters of interpreted strike length on the optioned properties. Geophysics also indicates multiple undrilled conductors both to the north and south of the main mineralized trend. 

The Central Canada Project and the patented ground boast excellent infrastructure with a natural gas pipeline, CN railway, high-voltage power transmission lines, and the Trans-Canada Highway located within 2 kilometers of the project. The purpose of the MOU is to give the Company enough time to complete the necessary due diligence to work towards signing a definitive agreement on or before June 1st 2020.

Under the terms of the MOU, the Company can earn an option to acquire 80% interest by making a payment of $25,000 within 45 days of signing a definitive agreement, making option payments of $45,000 to maintain the patented properties, and incur minimum $146,900 expenditures on the property within the first 18 months. Issue 500,000 common shares at a deemed price of $0.05 cents a share and 500,000 purchase warrants at a conversion price of $0.10 cents for a two-year period.

After acquiring an initial 80% interest Falcon has the right, for a period of 36 months, to acquire GLE's residual 20% interest (for a total Falcon ownership of 100%) for a further payment of $130,000 (payment delivered in 50% cash and 50% common shares in Falcon). The common share portion of the payment will be based on the last 10 days of trading price VWAP (Volume-Weighted Average Trading Price). The Agreement is subject to TSX Venture Exchange approval. 

"This MOU furthers Falcon's vision to consolidate the lands on the Central Canada Belt for the first time under one company. This ground is a strategic acquisition for Falcon as we continue to develop the Central Canada Project. We have now secured the necessary land position, including the known occurrence of certain mineralization, to quickly advance the project and seek to expand the size and economic potential for base and precious metals," stated Karim Rayani, CEO and Director of Falcon.

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