The purpose of this business plan is to set out a 5 year strategic plan for Homegold and Partners in a new iron ore production venture. The Plan will also define potential investors; to assist in obtaining financing for growth in continuing projects, expansion of our operations; and to ascertain new markets for the magnetite products. While we strive to achieve our external goals and objectives, we will concurrently work at achieving our internal goals and objectives in the areas of corporate governance, executive and management team expansion, and policy and procedure. Our bottom line is concerned with not only profitability, but is also focused on the sustainability of the environment and our social responsibility in the communities where we are located as well.
Currently, Homegold Resources Ltd. has two properties in the permit phase and eleven other separate properties in the exploration phase. Steele Creek and the old Nimpkish Iron Mine are located on Northern Vancouver Island within the traditional territory of the Namgis First Nation.
Expansion of a second phase of Magnetite production can be by opening up the waste dumps and tailings at the old Nimpkish Iron Mine along the Nimpkish River north of Woss.
The relationship between Homegold and the Namgis First Nation will be firmly established with a Partnership Agreement. The Namgis are now considering a partnership on the larger economic proposal. The outlook for continued growth in our relationship remains positive.
In an effort to keep our costs down, one cost saving measure has been to manage the company on a contractual basis with part-time contracts. In most cases the management team has been wearing two or more hats. In the early stages, this made economic sense, but now that we are poised for expansion, it makes sense to hire an Operations Superintendent to work on a part-time basis in the North Island to manage the operations, to comply with the regulatory agencies, to maintain safety standards and to adhere to the contractual agreements that are in place. In so doing, the President and Geologist will be able to focus more on finding new potential properties.
Homegold has several properties that are in various stages of exploration. We have thirteen (13) potential properties that all have immediate magnetite production possibilities. Of our 13 properties, the most imminent to come into development and production are the Steele Creek property, Nimpkish Iron, Iron Ross near Sayward and the Argonaut dumps and tailings. The venture will consist of drill/blast 2 magnetite production followed by magnetite concentration to produce a 10 mesh, 60% Fe product that will be loaded on a ship and delivered to China.
The Project is potentially very profitable, as more fully described in Appendix I. Recent increases in commodity prices, largely driven by increased demand from China, have produced substantial increases in the world market price for iron ore, copper, gold and other metals. The Project will keep its capital costs low by using contract miners, and will load large-sized vessels to minimize shipping costs. Additionally, capital and operating costs are much lower in China than in the US, so processing the ore into finished products in China makes economic sense despite the increased cost of shipping raw ore.
The Iron Ross Project is approximately 6 km from tidewater, west of the Community of Sayward, B.C. The main showings of massive magnetite are 400m west of the Iron Mike Mine, which operated in 1965-1966, producing from 168,735 tonnes about 112,799 tonnes of 62.26% iron concentrate.
Extensive airborne and ground magnetometer surveys were completed by 1983 by Dickenson Mines Limited, which outline 4 additional large massive to skarnified magnetite zones to the west of the Iron Mike main pit.
Magnetite concentrates from the Iron Mike were apparently shipped (by ocean-going vessel) out of Menzies Bay 52.2 km to the south. However, as part of a major reorganization of their island operations, the large dryland Log sort operated in Sayward by Weyerhaeuser is scheduled to be phased out during the near future, which may open up opportunities to barge out of Kelsey Bay. Most Weyerhaeuser logs will now go out of Menzies Bay. The Eve River log sort to the north has already been shut down.
Much of the magnetite produced in British Columbia at the present time is from a sophisticated reprocessing of tailings (Craigmont) or small time hit and miss reprocessing coarse waste dumps (Texada Island and elsewhere). Possible markets for magnetite are: heavy aggregate for highdensity concrete, heavy media for coal washing, sandblasting abrasives, high-density filter media and radiation shielding aggregates. Two major construction projects under consideration are the expansion of the sub-atomic research TRIUMF facility at the University of British Columbia and the Sumas-Duncan Natural Gas Pipeline (for pipe anchors) by BC Hydro and Williams Pipeline Company. There may also be increasing application to special designed heavy concrete foundations in areas of high hydrostatic ground pressure in areas like Richmond, B.C.
An alternative market may be as a raw material for cement plant use. The current supply from Anyox slag assays 36.4% SiO2, 5.1% Al2O3 but only 45% Fe2O3. Anyox slag also assays typically about 3% SO3 and has a relatively high Bond work index of >23. Bond work index of 10.7 and 15.0 have been obtained for magnetite from other properties on Vancouver Island. The average specific gravity for 3 samples from the Iron Ross Zone is 5.1.
Specifications for sandblasting are minus 20 mesh plus 100 mesh with most of the size distribution in the 50 to 70 mesh fractions. Arsenic should be below 50 ppm for total metals.
Product constraints for use as heavy media coal washing include (1) greater than 4.7 specific gravity, (2) greater than 95% magnetics, (3) not less than 90% passing 235 mesh (45 microns) and (4) not more than 30% passing 10 microns. Testing was conducted in 2003 to produce heavy media concentrate for use in marketing and market evaluation.
A small follow-up sampling program was completed in 2022 as a follow-up to previous programs were carried out from July 19 to December 1, 2017 on a claim group of three (3) claims which includes the White Fang showings located in north west Vancouver Island. A 2 man crew conducted prospecting, rock geochem sampling. A total of 10 samples were collected in 2017 of which all were rocks and 15 rock samples were collected in 2022. The Bon 20, 24 and White Fang occurrences are underlain by Triassic Karmutsen Formation volcanic rocks in contact with the Nimpkish Batholith. The contact zones contain semi-massive chalcopyrite and magnetite up to 2.66% Cu over considerable widths. Along the intrusive-volcanic contact there are numerous showings. Work in 2022 followed up work in 2017 which concentrated on investigating this prospective contact and the known White Fang showings along it. A Mines Act Permit #MX-8-289 has recently been issued but the permit is no longer in effect.
The White Fang property lies within a belt of gold-rich skarn deposits located on the east and south sides of Nimpkish Lake on northern Vancouver Island. The area is east of Zeballos, and south of Port McNeill. The property contains multiple occurrences of high grade copper mineralization with associated gold mineralization within garnet and magnetite skarn lenses. Just north of White Fang Showing along an intrusive contact to Steele Creek, a small zone was open pit mined in 1967, and is known as the Bonanza Mine. This high-grade lens returned 2,163 tonnes of 5.4% copper, plus 0.5 oz/ton silver and an unreported quantity of gold (0.09-0.15 oz./ton of gold).
Locally, the andesite has been altered to garnet-epidote skarn which hosts lenses of massive magnetite or pyrrhotite. The current logging road system provides access to the central portion of the claims and the White Fang magnetite showing and the Bon 24 showing of stratabound copper zone of possible red-bed affinities (Gold Tiger Showing). Previous samples collected in 2008 assayed up to 8.04% copper and 68.5 g/tonne silver. Zinc assayed up to 1.9% Zn, gold up to 0.516 g/tonne Au and Cobalt up to 1039 ppm.
Work in 2017 indicates copper values are up to 13.49% (sample J-7) in massive magnetite skarn. Six samples returned copper values in excess of 1% Cu which confirm some of the previous work conducted on the property since 1961. Some massive magnetite samples (J-11) are only 0.12% Copper.
Current work in 2022 returned copper values up to 4668ppm Cu in garnet skarn. Samples WF-1 to WF-5 are mostly microdiorite often associated with mineralized skarn zones with silica ranging from 11.68% Si to 19.38% Si. These rocks contain calc-silicates such as garnet and epidote. Iron content is consistently elevated from 8.11% Fe to 9.63% Fe.
Two samples (WF-6 and 7) are of salmon red syenite, coarse crystalline, which appear to be a potassic phase of the Nimpkish Stock. Potassium ranges from 2.11% K to 3.37%K. Both samples are high in silica (up to 21.19% Si) but very low in iron (1.53% Fe to 2.22% Fe).
Samples WF-8 to WF-15 are variations of distal skarn assemblages. Silica is relatively uniform ranging from 10.05% Si to 19.11% Si. Variable iron ranges from 10.20% Fe up to 27.30% Fe. Sample WF-14 has chalcopyrite stringers.