Orsa has the option to earn a 100% interest in the Coal Canyon Property (Coal Canyon) In Pershing County, Nevada subject to cash payments and an underlying NSR. The property consists of 35 contiguous, unpatented, lode mining claims. Coal Canyon is located seven miles east of Lovelock, Nevada in the West Humboldt Range of Pershing County. The property is accessible year round by County roads and a newly Orsa-constructed road.
The primary exploration target is a sediment-hosted gold deposit similar to what has been discovered at the Willard five miles to the north of the claims. Coal Canyon is located within the Oreana Mining Trend (the "Trend") where over 10 million ounces of gold have been defined since 2009. Gold deposits in the Trend include Rochester, Standard, Florida Canyon, Spring Valley, Willard, Rye Patch and Colado. Gold mineralization at Coal Canyon is hosted in calcareous sediments of the Auld Lang Syne Group which is the same host rock as most of the reported deposits in the Trend.
On May 1, 2012 Orsa announced that it had made a gold discovery on the property as a result of a recent road building, trenching and sampling program.
Approximately 3,000 feet of new road were constructed at Coal Canyon to provide access to some of the mineralized zones and to expose altered bedrock for sampling. Wide zones of intense argillic alteration of the sediments were exposed with some zones having the appearance of an oxidized, sulfide-cemented breccia. Chip-channel samples from five to ten feet in length were collected from outcrops in the road bank. One of the sampled zones comprising a continuous group of eighteen samples from a strongly altered zone of calcareous siltstone averaged 0.015 oz. Au/ton over a distance of 142 feet (0.520 grams Au/tonne over 43.3 metres).
Trenching at Coal Canyon has exposed an altered and mineralized contact between intrusive and sedimentary rocks. Greater than 0.029 oz. Au/ton (1 gram Au/tonne) values were found in a 5,800 foot-long, northwest-trending zone that is up to 500 feet wide. This zone contains arsenic values up to 1,000 ppm and antimony values up to 3,000 ppm. Previous sampling on the project returned gold values up to 0.093 oz. Au/ton (3.2 grams Au/tonne) from silicified intrusive and altered calcareous siltstone outcrops within the larger zone.
The mineralized zone extends on to two sections controlled by New Nevada Land (NNL) and New Nevada Resources (NNR. Orsa, through its wholly-owned US subsidiary, Orsa Minerals Corp. ("ORSA MC"), has entered into a lease agreement with NNR and NNL, mineral and surface rights owners respectively of two sections of land adjacent to the Coal Canyon discovery area. The Agreement provides for a shared working interest, annual rental payments, a 3.5% Net Smelter Return Royalty ("NSR") on Precious Metals in favour of NNR and has an initial term of twenty (20) years after the effective date and may be renewed or cancelled.
The Agreement provides for ORSA MC to hold an undivided 85% working interest and NNR an undivided 15% working interest in the two sections which comprise 1260 acres. Each party is entitled to a share of production of minerals from the leased area in proportion to the percentage interests that party holds.