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JV Project - Bulgaria

Kalabak and Zlatusha Projects (Optioned to Raiden Resources)

In July 2019, Gold Bull (formerly known as QX Metals Corp.) entered into two option agreements dated July 2, 2019 (the “Kalabak Option Agreement”) and July 13, 2019 the (“Zlatusha Option Agreement”) with Raiden Resources Limited (“Raiden”), an Australian Securities Exchange listed company, in respect of optioning to Raiden, an initial 51% interest, and up to a 75% interest, in the mineral exploration license covering the Kalabak and Zlatusha projects (“Kalabak License”, “Zlatusha License”) located in Bulgaria. Gold Bull remains the 100% holder of the Kalabak and Zlatusha Licenses, through its wholly-owned Bulgarian subsidiary Zelenrok EOOD.

Opportunity Overview

Kalabak Option Agreement Terms

First Option: By completing US$1 million on project expenditures within a 2-year period, Raiden has the option to earn 51% in the Kalabak License. The expenditure requires the completion of a minimum of 3,000 meters of reverse circulation or diamond drilling.

Second Option: By completing a 43-101 compliant Preliminary Feasibility Study (“PFS”) which must be supported by a minimum of 30,000 meters of reverse circulation or diamond drilling over a  period of seven years and subject to a minimum of 2,000 meters of drilling in each two year period, Raiden has the option to earn into 75% of the Kalabak License.

The Company’s interest is carried through the second option, and if exercised by Raiden, the parties will continue on a joint venture basis thereafter. In certain circumstances, if Raiden does not proceed with the Kalabak Second Option, the parties will proceed on a 49%-51% joint venture basis.

Gold Bull has the option to dilute its remaining stake in the Kalabak License to a 2% Net Smelter Royalty (“NSR”), where Raiden will have the option to purchase an initial 0.5% of the total NSR for US$2.5m and with a further 1% being purchasable for US$5m, prior to commencement of commercial production 

Zlatusha Option Agreement Terms

First Option: By completing US$2.5 million in project expenditures within 3 years of the Zlatusha Option Agreement coming into effect (via completion of the underlying exploration agreement with the Ministry of Energy of the Republic of Bulgaria - the “Zlatusha Effective Date”), Raiden has the option to earn 51% in the Zlatusha License. The expenditure requires the completion of a minimum of 6,500 meters of reverse circulation or diamond drilling.

Second Option: By completing a 43-101 compliant Preliminary Feasibility Study (“PFS”) which must be supported by a minimum of 60,000 meters of reverse circulation or diamond drilling by the 7th anniversary of the Zlatusha Effective Date, subject to a minimum of 2,000 meters of drilling in each two year period, Raiden has the option to earn into 75% of the Zlatusha License.

The Company’s interest is carried through the second option, and if exercised by Raiden, the parties will continue on a joint venture basis thereafter. In certain circumstances, if Raiden does not proceed with the Zlatusha Second Option, the parties will proceed on a 49%-51% joint venture basis.

Gold Bull has the option to dilute its remaining stake in the Zlatusha License to a 2% Net Smelter Royalty (“NSR”), where Raiden will have the option to purchase an initial 0.5% of the total NSR for US$2.5m and with a further 1% being purchasable for US$5m, prior to commencement of commercial production 

Zlatusha Project and Geological Setting

The Zlatusha license area (195 km2) lies within an established porphyry copper-gold/epithermal belt located northwest of Sofia, in the Western Srednogorie segment of the Banat-Timok-Srednogorie magmatic arc. The Zlatusha project was selected for license application based on the presence of prospective geology, consisting of Cretaceous arc magmatic rocks, epithermal and porphyry copper related alteration systems and copper and gold mineral occurrences. Several separate magmatic-hydrothermal centres with outcropping copper-gold mineralization have been identified within the permit.

The Zlatusha license was approved by the Bulgarian Council of Ministers in June 2016. Raiden is expecting issuance of the formal exploration permit from the Minister of Energy shortly, which is the final step required in the application process, at which time field activities can commence.

The project area is underlain by Upper Cretaceous andesite volcanic rocks, Cretaceous carbonate and clastic sedimentary rocks, which are intruded by diorite porphyry stocks and dikes. The geological setting of these highly prospective rocks is similar to the Cukaru Peki deposit, 65 kilometres to the northwest in eastern Serbia, and to Chelopech mine, 45 kilometres to the east in Bulgaria’s Panagyurishte trend.

Multiple porphyry-related alteration zones, characterized by intense quartz-sericite-pyrite alteration and associated biotite altered diorite porphyry, are present at Zlatusha. Outcrops of quartz vein stockwork with chalcopyrite mineralization cutting biotite altered diorite porphyry have also been identified on the property.

The license contains several primary and multiple secondary exploration targets defined by hydrothermal alteration, and/or anomalous copper and/or gold geochemistry, interpreted to be related to epithermal and porphyry environments within a potential porphyry system. 

Kalabak Project and Geological Setting

The Kalabak license is located in the Haskovo Province, Kardzhali district in southeast Bulgaria. A main highway from the capital city Sofia covers over half the distance to the project location, with secondary paved roads covering the rest of the distance. The city of Kardzhali is the closest large centre, with a population of 44,000 (2011), and is within 70km of the project. Two paved roads transect the license – one on the east side, one on the west side. A dense network of forestry and farm roads cover the area.

The Kalabak license was awarded to Zelenrok EOOD, a 100% owned subsidiary of QX, in October of 2017, with approvals from the Ministry of Energy and the Ministry of Environment and Water. A comprehensive three-year exploration work program was approved by all the required ministries.

The Kalabak project is situated in the Eastern Rhodope Mountains, which reside in a 500km long magmatic belt that spans from Eastern Europe through to Iran, a result of post-Paleocene-Eocene extension that followed Upper Cretaceous collisional activity.

The Kalabak license is underlain by metamorphic basement rocks of the Kesebir-Kardamos Metamorphic Dome that are unconformably overlain by Tertiary aged sedimentary rocks of the Krumovgrad Group. Tertiary intermediate to felsic intrusive and volcanic rocks intruded into and overlie both of these units. This suite of Tertiary intrusives and their equivalents in Turkey and Greece are associated with significant porphyry and epithermal mineralised systems.

Qualified Person

Rory Kutluoglu, B.Sc. P.Geo., a Qualified Person as defined by National Instrument 43-101, has read and approved all technical and scientific information contained in this news release.

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