Vancouver, BC / February 10, 2020/ Blue Star Gold Corp. (“Blue Star” or the “Company”) is pleased to report the Company has completed the acquisition of the Ulu Gold Property (the “Ulu”) from Mandalay Resources Corp. (“Mandalay”). Supplementing its high-grade gold resources, the Ulu includes a substantial inventory of capital equipment, a Weatherhaven camp with shop and a 1,200 m long airstrip. The mineral rights in the form of a Crown mining lease were transferred on January 7, 2020 to Blue Star. The Kitikmeot Inuit Association (the “KitIA”) agreed on October 1, 2019 to transfer surface access in the form of a land use licence, and on September 10, 2019 the Nunavut Water Board (“NWB”) authorized the assignment of the Ulu Water Licence 2BM-ULU1520 to Blue Star.
Through the final steps in the Ulu acquisition process, Blue Star has:
• Paid to Mandalay the final payment of $450,000 in cash upon transmittal of the Ulu mining lease to Blue Star Gold;
• Arranged for an arm’s length third party to purchase Mandalay’s 5,000,000 Blue Star shares;
• Posted remediation security required by the KitIA and the NWB in the amounts of $750,000 and $1,685,542 respectively;
• Assumed future reclamation and monitoring obligations associated with Ulu in a manner satisfactory to the KitIA and the NWB; and,
• Received from Mandalay the transfer of $1,685,542 that was released by the Crown Indigenous Relations and Northern Affairs Canada respecting Mandalay’s remediation account for the Ulu in relation to the water licence.
The Ulu Gold Property is located approximately 50 km north of the Arctic Circle in the Kitikmeot region of western Nunavut. The site of the future deep-water port at Grays Bay is 100 km to the north of the lease and the proposed route corridor for the all-weather Grays Bay road passes in close proximity to Ulu. The Property consists of the renewable 21-year Mining Lease No: 3563 with an expiry date of Nov 18, 2038 and covers an area of approximately 947 ha. The lease hosts an advanced gold project that between 1989 and 2012 saw significant exploration and development. The past work includes approximately 1.7 km of underground development and approximately 405 diamond drill holes
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Figure One: Blue Star’s gold occurrences and resource zones located within the Ulu Gold Property and the Hood River Concessions.
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