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$20M raised for CORE Alaska gold projects

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Funds will support 2022 programs at Manh Choh, Lucky Shot North of 60 Mining News – April 15, 2022Contango ORE Inc. April 9 announced that it has entered into a binding agreement to raise US$20 million through the issuance of debenture, an unsecured loan that can be converted into shares, to fund its commitments at the Manh Choh gold project in eastern Alaska and for exploration and development on its Lucky Shot gold mine properties in the Southcentral region of the state.”With strong fundamentals in the gold market, management is excited to advance our portfolio of high-quality projects in Alaska,” said Contango ORE President and CEO Rick Van Nieuwenhuyse.Under the agreement, Queen’s Road Capital Investment, Ltd. will purchase the debenture at par price and can convert it into Contango common stock at any time at US$30.50 per share (subject to adjustment). This unsecured loan will bear an annual interest at 8%, payable quarterly with 6% paid in cash and 2% paid in Contango shares at the market price at the time of payment based on a 20-day volumetric weighted average price. “Management is pleased to finalize this financing with Queen’s Road Capital. I have known Warren Gilman, the principal of QRC, for a long time and have been impressed with his grasp of the mining sector, particularly for recognizing investment opportunities in quality exploration/development stage companies,” said Van Nieuwenhuyse. “We intend to use the proceeds from this financing to fund our share through completion of the feasibility study at our 30% owned Manh Choh project managed by Kinross (70%), as well as our planned underground exploration program at our 100% owned Lucky Shot project.”Being advanced by the Peak Gold Joint Venture between Kinross Gold Corp. and Contango, Manh Choh hosts 9.2 million metric tons of measured and indicated resources averaging 4.1 grams per metric ton (1.2 million oz) gold and 14.2 g/t (4.2 million oz) silver.Kinross plans to process this high-grade gold ore through the existing mill at its Fort Knox Mine, which is about 240 road miles northwest of Manh Choh. This plan to use existing processing and tailings storage infrastructure is expected to improve the economics and lessen the environmental footprint of a mine at Manh Choh.A feasibility study that details the engineering, economic, and environmental parameters of this mine plan is expected to be completed in the second half of this year.At the same time, Contango is advancing the development of a high-grade underground mine at Lucky Shot. A road-accessible project about 75 miles north of Anchorage, the 8,590-acre Lucky Shot property blankets a large portion of the Willow Creek Mining District, including the pre-World War II Lucky Shot and War Baby mines. It is estimated that from 1918 until being shut down by the federal War Production Board in 1942, these two underground operations produced more than 250,000 oz of gold from 169,000 tons of ore, indicating an average head grade of around 1.5 oz of gold per metric ton.A 2016 calculation completed for former operators Miranda Gold Corp. and Alaska Gold Torrent Inc. outlined 206,500 metric tons of measured and indicated resources averaging 18.3 g/t (121,500 oz) gold and 59 thousand metric tons of inferred resource averaging 18.5 g/t (35,150 oz) gold at Lucky Shot.Shane LasleyA mine car sits outside a mine portal at the historic Lucky Shot gold mine in Southcentral Alaska.With its sites set on establishing a large enough resource to support a modern mine at Lucky Shot, Contango has a contractor rehabilitating and expanding the historic underground workings, which will serve as a platform for underground drilling.”Underground development mining is underway at Lucky Shot and we expect to drill a pilot hole next month to determine where to place the underground drift parallel to and in the footwall of the historically mined Lucky Shot vein,” said Van Nieuwenhuyse. “The exploration drift should be completed by late summer when exploration drilling will start.”Through this work, the company aims to identify a prospective resource of between 500,000 and 1 million oz of gold that can be economically mined.The debenture will have a maturity of four years after issuance, which is expected to occur by April 29, subject to customary closing conditions.Author Bio
Shane Lasley, Publisher
Over his more than 14 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

Email: [email protected] Phone: (907) 726-1095https://www.linkedin.com/in/shane-lasley-ab073b12/

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