The North American Gold Royalty Company

Fenelon Royalty

Ely Gold currently holds a 2.00% net smelter returns royalty on the Fenelon property currently operated by Wallbridge Mining Company Limited. Under the Agreement Ely Gold acquired the Fenelon 2% Royalty for cash consideration of CAN$600,000. The closing date of the transaction was April 15, 2019. In connection with the Agreement, Ely Gold has received all documentation to support the validity and ownership of its newly-acquired Fenelon 2% Royalty.

Wallbridge’s Fenelon Gold property is located in northwestern Quebec proximal to the Sunday Lake Deformation Zone (SDLZ) which hosts the Detour Gold Mine in Ontario, and Balmoral Resources’ gold deposits at Martiniere. The 1,052 hectare Fenelon Gold property hosts the Discovery Zone gold deposit and surrounding four km strike length of a gold-hosting secondary splay of the SDLZ. A total of over 50,000 metres of drilling have been completed and, very significantly, two bulk samples have been mined and processed from the deposit. In 2001, a 13,835 tonne bulk sample mined from a small open pit at the Discovery Zone returned a reconciled grade of 9.84 g/t gold. A second 8,169 tonne bulk sample, mined from underground in 2004 returned a reconciled grade of 10.7 g/t gold. Both bulk samples were processed at the Camflo mill in Malartic yielding 97% gold recoveries and similar recoveries were achieved in recent metallurgical test work initiated by Wallbridge (see pre-feasibility technical report: .

After acquiring the property in late 2016, Wallbridge completed an updated resource estimate and a positive pre-feasibility study (PFS) on the existing resource (see Wallbridge Press Release dated February 02, 2017 and Wallbridge website at

The 2016 resource estimate is comprised of Measured and Indicated resources of 38,000 ounces gold contained within 91,100 tonnes grading 12.97 g/t gold and Inferred resources of 1,900 ounces gold contained within 6,500 tonnes grading 9.15 g/t gold and is limited to close proximity to the existing mine workings.

The PFS estimates a Pre-tax Net Cash Flow of $6.62M and a Project pre-tax Internal Rate of Return ("IRR") of 92% for the initial approximate 18 month mine life for the known reserves located above 100 meters depth and in close proximity to the existing ramp.

In 2017 and since acquisition, Wallbridge has completed 33 drill holes totalling 6,348 metres in three surface exploration drilling campaigns at Fenelon (see Wallbridge Press Release dated December 13, 2017). Results from this initial year's exploration drilling program have exceeded expectations and resulted in an expanded exploration target for the area near existing infrastructure and above 150 metres depth.

Drilling significantly extended existing zones and discovered several new parallel zones. Highlights include:

  • FA-17-07 which intersected three zones including 141.16 g/t gold over 7.06 metres in the Viper Zone;
  • FA-17-17 which intersected four zones including 311.08 g/t gold over 3.06 metres, also in the Viper Zone;
  • FA-17-26 which intersected two zones including 260.44 g/t gold over 7.02 metres, also in the Viper Zone; and
  • FA-17-27 which intersected 80.42 g/t gold over 4.73 metres in the Habanero Zone.

The results of the 2017 drilling, along with geological and structural modelling and reinterpretation of the deposit, have led to an expanded exploration target of an additional 70,000-120,000 ounces gold within 150,000 to 375,000 tonnes grading between 10-15 g/t gold immediately adjacent to the existing infrastructure and in the top 150 metres from surface. This exploration target is in addition to the 2016 resource estimate

Very little drilling has been carried out below this depth and the mineralization remains open to depth and along strike. In addition, drill intersections along the four kilometre strike length of the mineralized structure demonstrate potential for new discoveries on the broader property.

Additional surface and underground exploration drilling as well as a 35,000 tonne underground bulk sample are planned for 2018. All permits for the 35,000 tonne bulk sample have been received (see Wallbridge Press Release dated January 16, 2018) and mobilisation for the bulk sample program has begun in January, 2018.