Overview

Historical Exploration

The Ekuzya project is a brown field exploration play located adjacent and south of the producing Chala gold mine.  The Ekuzya project is a former (1980’s) base-metal exploration project where only 3% of drill samples were ever assayed for gold.  Exploration was completed before the contiguous Chala gold mine was discovered.  Velocity interprets mineralization at Ekuzya to be part of a larger epithermal gold-base metal system. 

Velocity has compiled all of the exploration data available within the Ekuzya property and has digitally captured the most significant information into a project database stored within a Micromine exploration and mining software system.  Historical exploration within the Ekuzya property includes 79 base metal diamond core drill holes for 64,350m with no gold analysis and 17 gold diamond core drill holes for 15,095m.

Exploration Upside

The mineralisation at the Ekuzya property is an Intermediate Sulphidation Epithermal vein type gold – base metal deposit.  Previous Soviet-style exploration appears to have been vigorous, systematic and based on a solid understanding of economic geology.  The digital capture of these large data sets (more than 200 large format maps scanned and digitised) has enabled Velocity to produce a reasonable model of mineralisation within the Ekuzya property with the result that the structural control on mineralisation has become apparent.

Velocity has identified three target areas named Zone 5, Zone 5a, and Ekuzyata, where previous operators have reported significant gold results.  The highest priority target is the potentially open pittable, stratabound epithermal vein and dissemination target at Ekuzyata.  Previous trenching has identified a shallow dipping zone over a strike length of 500m and a down dip extent of at least 250m. 

Previous trenching returned multiple significant intercepts across the strike extent with 3.5m @ 6.0g/t in the west, 10.8m @ 2.2g/t in the centre of the target and 3.1m @ 3.6g/t in the east.  True thicknesses at Ekuzyata are at present difficult to ascertain with the current level of available data.  The stratabound mineralisation is present at multiple horizons and the potential for stacked mineralisation is considered to be good. 

Location

The Ekuzya property has an area of 2.13 kmand is located within the Chala Mining Concession held by Gorubso Kharzhali A.D. (“Gorubso”), and located in southeast Bulgaria, about 230km by road, east-southeast of the capital Sofia.  The Ekuzya property is situated south and adjacent to the currently operating Chala gold mine, which has been in continuous operation since 2006, operated by Gorubso.  Gorubso’s processing plant includes a cyanide tank leach plant and tailings management facility and is located at the town of Kardzhali, 35km by road from the Chala Mine.  The mining concession is valid until 2031.

Ekuzya can be accessed year-round by four-wheel drive vehicle via a collection of existing forestry and historical drill roads.  The Chala mine office is located in the small village of Gorno Bryastovo where mine staff totalling 210 employees operates three shifts per day, year-round operation.  The Chala mine site contains basic ore handling infrastructure, an underground explosives magazine and various workshops for routine maintenance and repair.  Run of mine ore is transported by trucks to Kardzhali for processing at Gorubso’s processing plant prior to crushing, milling, gravity concentration and on-site cyanide in leach (CIL) extraction, elution and production of gravity concentrate and dore.

Ownership

Velocity (through a Bulgarian subsidiary) holds an option to acquire an undivided 50% legal and beneficial interest in the Ekuzya property free and clear of all liens and encumbrances in consideration for incurring US$1 million in exploration expenditures over a two year period, provided that if after Velocity has incurred the expenditures and there is a delay of more than 180 days in effecting the transfer of the earned interest in the property to Velocity or if at any time prior thereto Velocity elects not to exercise the option, then Velocity’s interest in the Property will revert to a 5% gross value commission on all metals discovered by Velocity and subsequently mined from the property.

In addition, Velocity also has an exclusive one-year period (March 2018) during which to negotiate with Gorubso to acquire an interest in the Chala Mine. 

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