Frontline Announces Acquisition of Rainy River Properties Strategically Located Adjacent to Chalice Gold's Cameron Gold Project

May 06, 2016 10:19 AM EDT | Source: Frontline Gold Corporation

Toronto, Ontario--(Newsfile Corp. - May 6, 2016) - Frontline Gold Corporation (TSXV: FGC) ("Frontline" or the "Company") is pleased to announce that it has, subject to regulatory approval, acquired a 100% interest in seven (7) gold properties in the Rainy River area of Ontario, ("Rainy River Properties") which are strategically located adjacent to Chalice Gold Mines Limited's Cameron Gold Project ("Chalice Gold's Cameron Gold Project") in the Rainy River area. The properties comprise 7 individual property groups covered by 21 mining claims (see attached map).

Chalice Gold's Cameron Gold Project is located in the mineralized Kakagi Lake Greenstone Belt of the Archean-aged Superior Province located in the Kenora township in southwestern Ontario. In December, 2015, Chalice filed a Technical Report (the "Report") entitled "Technical Report on the Cameron Gold Deposit, Ontario, Canada". The Report included a resource estimate for the Cameron Gold project which, at a cut-off grade of 0.50 g/t gold, is estimated to have Measured and Indicated Resources of 7,824,000 tonnes grading 2.26 g/t gold (569,000 Au ounces) and Inferred Resources of 14,464,000 tonnes grading 1.92 g/t gold (894,000 Au ounces) (source: Chalice Gold Mines Limited website at www.chalicegold.com).

To exercise its option and acquire a 100% interest in the Rainy River claims, Frontline must issue a total of 1,000,000 shares of the Corporation and pay the Optionor a total of $108,000 (of which a total of $50,500 is due in years 3 and 4 of the option agreement), $18,000 has been paid to date, and grant the Optionor a 2% net smelter returns royalty. The properties are subject to a net smelter returns royalty of 2% on six claims and 1% on the remaining fifteen claims. Frontline may repurchase one-half of the 2% royalty for $1,000,000 and one-half of the 1% royalties for $250,000. The issuance of shares is subject to the receipt of all regulatory approvals, including approval of the Toronto Stock Venture Exchange.

Commentary

Frontline's President and CEO, Mr. Walter Henry, said, "The Rainy River Properties are an excellent addition given the proximity of Chalice Gold's Cameron Gold Project. Note that Chalice Gold on May 4, 2016 pressed released that it had entered into an agreement to sell its wholly-owned Cameron Gold Project, to First Mining Finance Corp. ("First Mining") in exchange for 32,260,836 common shares of First Mining., which represents approximately 8.1% of the issued and outstanding shares of First Mining. The deemed value of this transaction is approximately $13-million (source: www.chalicegold.com).

In addition, the low acquisition cost of the land package combined with no or minimal property expenditure requirements depending on the property allows us to grow our strategic positions in Red Lake and the surrounding area. The Flint Lake, Sandhill Properties that Frontline has acquired are strategically situated along the Pipestone - Cameron Fault which crosses diagonally through the Chalice Gold Cameron Gold Project land boundary."

Frontline's Rainy River Projects

Consists of 7 individual property groups:

  1)

Flint Lake

  2)

Sandhill Lake

  3)

Shingwak Lake

  4)

Hay Island

  5)

Peninsula Lake

  6)

Wampum Lake

  7)

Isinglass Lake

     

All the above reference properties, excluding Shingwak Lake and Sandhill Lake have reported historical gold occurrences.

Flint Lake: 6 Claims located along the Pipestone Cameron Fault, with the group adjacent to Chalice Gold's Cameron Gold property that host its Dogpaw and Dubenski deposits. Frontline's specific rationale in acquiring this land package had to do with strategically adding undervalued gold exploration properties where the cost to maintain the properties is minimal. As noted in the table below, this claim package has a combined C$417,631 in banked assessment credits; after the current maturity dates of land claims 2019/2020, the combined $11,200 in annual required work on the group would be covered for the next 30 plus years by the banked assessment credits.

Sandhill: 3 claims located in the Brooks Lake Area and adjacent to Cameron Gold Project and where ideally situated to where Chalice did its 2015 Cameron Rock Chip and Soil Programs (source: http://www.chalicegold.com/images/content/Corp_Presentation_Feb_2016.pdf)

Hay Island: 4 claims located just south of the Chalice's southern property boundary. The 4 claims are host to mafic and ultramafic intrusive rocks and contain recorded historical gold drilling results.

Peninsula Bay: 2 claims located in the Dogpaw Lake Area. The 2 claims are host to mafic and ultramafic intrusive rocks and contain recorded historical gold drilling results.

Frontline has not completed any work required to verify the historical mining estimates noted above and is not treating these historical estimates as being compliant with current standards under NI 43-101 and as such these historical estimates should not be relied upon. Caution should be used when evaluating these resources as they were calculated prior to NI 43-101 existing and a qualified person has not done work to classify the historical estimate as a current mineral resource.

Frontline continues to actively seek additional investor/partner(s) in order to continue to advance its tailings projects in Turkey and its exploration programs for its Red Lake portfolio of properties. To contact Frontline, please call Walter Henry at 416-414-5825 or visit the company's website.

The technical information herein was reviewed by Mr. Greg Isenor, P. Geo., who acts as Frontline's Qualified Person as defined by National Instrument 43-101.

About Frontline Gold Corporation

Frontline is a Canadian junior mineral exploration company with an experienced discovery team and a proven record of accomplishment. The Company's principal properties include the Menderes gold project in the Izmir province of Western Turkey, the Flint Lake and Sandhill Lake gold projects which are adjacent to Chalice Gold's Cameron Lake Gold Deposit in Ontario and the Niaouleni gold project in southern Mali in the heart of West Africa's prolific gold belt. Other Canadian exploration properties include its Red Lake (gold) property groups that include the Whitehorse Island Mining Patents.

Further information about the Company is available on the Company's website, www.frontlinegold.com, or our social media sites listed below:

Facebook: https://www.facebook.com/frontlinegold.corp
Twitter: https://twitter.com/frontlinegold

This news release contains forward-looking statements, which address future events and conditions, which are subject to various risks and uncertainties. The Company's actual results, programs and financial position could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Company's control. These factors include: the availability of funds; the timing and content of work programs; results of exploration activities and development of mineral properties, the interpretation of drilling results and other geological data, the uncertainties of resource and reserve estimations, receipt and security of mineral property titles; project cost overruns or unanticipated costs and expenses, fluctuations in metal prices; currency fluctuations; and general market and industry conditions.

Forward-looking statements are based on the expectations and opinions of the Company's management on the date the statements are made. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.

  Contact: Walter Henry
  Telephone: (416) 362-9100
"Walter Henry"                                Fax: (416) 362-9300
Walter Henry, President & CEO Email: info@frontlinegold.com
FRONTLINE GOLD CORP. Website: www.frontlinegold.com
     
  Frontline Gold Corp. (TSXV: FGC)
  1 Toronto Street, Suite 201
  Toronto, Ontario M5C 2V6
   

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