Avidian Gold spins out Strickland base metal project

Nov 27, 2018

2018-11-26 09:51 ET – News Release

Mr. Nick Tintor reports

AVIDIAN ANNOUNCES SPINOUT OF ITS CANADIAN PROPERTY AND VALUE CREATION INITIATIVE THROUGH HIGH TIDE RESOURCES

Avidian Gold Corp. has spun out its Strickland base metal project located in southern Newfoundland into a 100-per-cent-owned Ontario incorporated private company called High Tide Resources Corp.

Avidian’s goal will be to take High Tide public within the next 18 months.

The creation of High Tide is part of Avidian’s value creation initiative whereby any property asset that is not deemed to be core to its portfolio or is not being properly valued within Avidian will be spun out into a subsidiary company. The objective is to maximize shareholder value for Avidian properties held in Canada and Nevada.

Key benefits to Avidian and its shareholders include:

No financial dilution to Avidian;
Avidian will retain a 50-per-cent interest in High Tide following a flow-through share financing;
Avidian, via its share ownership, will have exposure to any exploration success High Tide has in Newfoundland.

High Tide has also entered into an option agreement to acquire a 100-per-cent interest in the Black Raven gold project located in northern Newfoundland.

High Tide’s board of directors will mirror the current board of Avidian comprising David Anderson, Doug Kirwin, James Polson, Nick Tintor and Dino Titaro, with Mr. Anderson appointed as chairman and chief executive officer of High Tide.

High Tide properties

Black Raven

The 12.25-square-kilometre Black Raven property hosts numerous high-grade gold showings where grab samples include 32.1 grams per tonne gold, 18.3 g/t silver and 14.0 g/t Au, with elevated to high-grade copper, lead and zinc values, and anomalous silver and molybdenum.

The highest metal values from different grab samples are 671 g/t Ag, 3.8 per cent copper, 32.0 per cent lead, 10.6 per cent zinc and 8,370 parts per million molybdenum. Although the property as a whole is significantly underexplored, approximately 10 per cent has been surveyed by a ground IP/resistivity geophysical program that has identified several chargeability anomalies proximal to known mineralization.

It is anticipated that drill targets can be developed quickly in these areas and in other areas of untested surface mineralization where High Tide has defined five areas for its immediate exploration focus.

The mineralization model is an intrusion related gold system (IRGS) with a possible porphyry component. This is similar to mineralization in the Tintina gold belt in Alaska and the Yukon, where Avidian has developed expertise over the past three years.

High Tide has an option to earn a 100-per-cent interest in the Black Raven property over three years via the issuance of $275,000 in shares and the completion of at least $70,000 of exploration work. The vendor retains a 2-per-cent net smelter return, of which 1.75 per cent can be purchased by High Tide for $2-million.

It should be noted that assay results from grab samples, due to their selective nature, may not be representative of the overall grade and extent of mineralization in the subject area. Grab sample values are from a database of 375 samples collected with values ranging from below or at the detection limit to the values quoted in this news release.

Strickland

The 5.25 sq km Strickland property is located in southern Newfoundland and is 100 per cent owned by High Tide. The property covers the best three strike km of an over 20 km long prospective tuff horizon in Paleozoic interlayered submarine volcanic and sedimentary rocks.

Surface results collected by High Tide personnel in 2012 include channel samples of four m grading 0.3 g/t Au, 263 g/t Ag, 2.05 per cent Pb and 3.96 per cent Zn, and eight m grading 1.37 g/t Au, 19.7 g/t Ag and 1.5 per cent Cu.

The exploration target for the property is to define one or more precious-metal-rich volcanogenic massive sulphide deposits.

Three resources, which are historical estimates and will require follow-up work, were previously defined on the property by Falconbridge Nickel Mines Inc. between 1980 and 1981:

Main zone: 260,000 tonnes grading 5.25 per cent lead-zinc, 195 g/t Ag;
North extension: 750,000 t grading 2 per cent Pb-Zn;
Silver Hill: 15,000 t grading 2 per cent Pb-Zn, 480 g/t Ag.

Copper-gold stringer mineralization is also present in several showings.

The resource estimates described above are historical estimates as defined by National Instrument 43-101 — Standards of Disclosure for Mineral Projects.

The company has not completed the work required to independently analyze and verify the results of the previous operators nor has a qualified person completed sufficient work to classify the estimates as current mineral resources or mineral reserves. As a result, Avidian is not treating these estimates as current mineral resources or mineral reserves.

The company believes these historic results provide an indication of the potential of the property and are relevant from a continuing exploration perspective.

In addition to the properties listed in this news release, High Tide is also reviewing other gold projects in Canada with the objective of possibly acquiring a third property in order to build critical mass within the company.

High Tide financing

To finance the exploration program required to advance the properties, High Tide is planning a flow-through share financing by way of a non-brokered private placement of up to $1-million. Flow-through shares will be issued at a price of 10 cents. The premoney valuation of High Tide is $1.0-million.

Nevada properties

Avidian recognizes that its current valuation is predominantly based on its Alaskan assets. As part of its value-creation initiative, Avidian is also conducting a strategic review on how best to maximize value from its two Nevada properties, Jungo and Dome Hill.

About Avidian Gold Corp.

Avidian Gold brings a disciplined and veteran team of project managers together with a regional-scale advanced stage gold-copper exploration portfolio in Alaska. Avidian’s Golden zone project also hosts a National Instrument 43-101 indicated gold resource of 267,400 ounces (4,187,000 tonnes at 1.99 g/t Au) plus an inferred gold resource of 35,900 ounces (1,353,000 tonnes at 0.83 g/t Au). Additional projects include Amanita which is adjacent to Kinross Gold’s Fort Knox gold mine in Alaska, Jungo and Dome Hill in Nevada, and Strickland in Newfoundland.

The technical information contained in this news release has been approved by Dr. Tom Setterfield, PGeo, vice-president of exploration of Avidian, who is a qualified person as defined in National Instrument 43-101 — Standards of Disclosure for Mineral Projects.

Further detailed information on the Golden zone property can be found in the technical report dated Aug. 17, 2017, prepared by Leon McGarry, BSc, PGeo, and Ian D. Trinder, MSc, PGeo, that has been posted on SEDAR.

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