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Scottie Resources (TSXV: SCOT) has entered into a financing arrangement with Franco-Nevada (TSX: FNV; NYSE: FNV) giving Scottie C$9.6 million ($7m) with which to advance its projects.
First, Scottie has sold a 2% gross production royalty to Franco-Nevada for C$8.1 million. The royalty will apply to Scotties claims in the Golden Triangle of British Columbia.
Second, Franco-Nevada has agreed to purchase a charity flow-through private placement for C$1.5 million. Each share is priced at C$0.275.
The investment by Franco-Nevada puts Scottie in a “strong financial position” said president and CEO Brad Rourke.
The company plans to use the proceeds primarily at its Scottie gold project 32 km north of Steward, BC. The project includes the past-producing Scottie gold mine that operated from 1971 to 1985 and produced 95,426 oz. of gold from ore with an average grade of 16.2 g/t gold.
The project includes other key targets, including Bend Vein, Domino, and Blueberry – the last one being of continuing interest to the company.
The Blueberry zone is located 2 km northeast of the historic Scottie mine. Historic trenching and channel samples resulted in high-grade assays as much as 103.94 g/t gold over 1.43 metres and 203.75.75 g/t gold over 1.90 metres. Scottie acquired the property in 2018.
Drilling at Blueberry in 2023 returned assays of 10.43 g/t gold over 7.7 metres, 88.40 g/t over 2 metres, 12.99 g/t over 8.5 metres, 8.78 g/t over 7.5 metres, 35.34 g/t over 5 metres, and 7.94 g/t over 13.9 metres.
Meanwhile, the two holes drilled at the Scottie mine last year assayed 13.10 g/t gold over 1.3 metre, 9.20 g/t over 1 metre, 8.47 g/t over 1.2 metre, and 8.80 g/t over 1 metre.
The last 43-101 report produced by the company for the Scottie gold project had no estimate of resources at the former mine. However, significant drilling during 2022 was aimed at expanding new high-grade gold prospects.
The deposit remains open along strike and at depth. There is also potential for multiple parallel mineralized structures, said the company. Numerous other high-grade veins have been identified but never drilled.
