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GOLD
Cameron Lake Project, Ontario:
 In December 2009, the Company announced the sale of Cameron Lake to Coventry Resources Limited (ASX:CVY) for consideration of approximately $12 million, including cash and upside participation in the form of equity and a royalty.
Located near Kenora in northwestern Ontario, Cameron Lake hosts a NI 43-101-compliant M&I gold resource of 748,000 tonnes grading 6.47 g/t and an inferred resource of 1,819,000 tonnes grading 4.99 g/t. Approximately $24 million was spent in the 1980s by a former partner of Nuinsco to develop the mine to the 865 foot level, and drilling has demonstrated that gold mineralization extends to greater than 700 metres. Nuinsco is reviewing options with regard to processing gold mineralized rock that is currently stockpiled at Cameron Lake. Approximately 14,000 tonnes of material was collected from numerous levels of the mine and crushed as part of a sampling program conducted in 1988 to produce representative samples for assay. Analysis by Lakefield Research at that time (now SGS Lakefield Research Limited) returned an average gold grade of 4.46 g/t (as this information pre-dates National Instrument 43-101, it cannot be determined at this time whether it would comply with National Instrument 43-101). This crushed material, and an additional amount of uncrushed development muck from mineralized zones within the deposit is currently stockpiled on surface and available for processing.
Using a gold price (US$991.70/oz) and exchange rate (1.25) as of February 23, 2009 and the 4.46 g/t average grade gives an in-situ value to the 14,000 tonnes of crushed rock of Cdn$2,500,000 (no value is ascribed here to the uncrushed material). Previous metallurgical testing indicates good gold recovery using conventional processing. Not only does this program provide the potential for significant revenue from gold sales, but it will also provide valuable information on metallurgy and recoveries that will be helpful with future development of Cameron Lake.
Nuinsco continues to evaluate the potential for Cameron Lake to become the cornerstone of a strategy to create a pure-play gold company that could act as the consolidator of gold deposits in the Kenora region. No timetable has been established to complete a spin-off transaction, however, activities to advance the process are ongoing, including the above-noted processing program; completing hydro-geological, environmental and socio-economic studies; consultation with the First Nations; and securing the required permits to dewater the underground mine workings. As well, Nuinsco has engaged a contractor to clean up its 700 tpd gold mill, which is currently located in Quebec, in order to recover any gold remaining in the circuit and has also identified a group to dismantle the mill and move it from its current location to the Cameron Lake Mine site if considered appropriate.
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