Orex Exploration

Orex Exploration

Company type	Public
Industry	Gold mining exploration
Founded	1987
Fate	Acquired by Anaconda Mining Inc. in 2017
Headquarters	Rouyn-Noranda , Canada
Area served	Goldboro and Guysborough County, Nova Scotia, Canada
Products	Gold mining exploration

Orex Exploration was a Canadian enterprise specializing in gold mining exploration, primarily operating within the Goldboro and Guysborough County areas of Nova Scotia. Its portfolio included historic mine locations such as Boston Richardson, Dolliver Mountain, West Goldbrook, and East Goldbrook Mines, which were active during the period from 1892 to 1912. Established in 1987 with its headquarters in Rouyn-Noranda, Quebec, Orex funded its exploration efforts through equity offerings on the Montreal Exchange and subsequently on the TSX Venture Exchange. In 2017, Anaconda Mining Inc. acquired Orex via a share exchange.

Property Description

The principal asset of Orex was the Goldboro property, encompassing 37 adjacent claims covering an area of 600 hectares under a license granted by Nova Scotia. Situated approximately 185 kilometers northeast of Halifax along the eastern coastline of Nova Scotia, the site is reachable by a 2.5-kilometer gravel road branching off Highway 316, which links Goldboro to Antigonish. The geographic coordinates are near 45°10′N latitude and 61°40′W longitude (NTS 11F/04).

On November 26, 2009, following the formation of a joint venture with Osisko Mining (previously Canadian Malartic Corporation), Orex expanded its exploration area by staking an additional contiguous block of claims totaling 960.8 square kilometers around Goldboro. Exploration activities on these newly acquired claims began shortly after.

Resource Estimates

In September 2009, Orex released a Mineral Resource Estimate compliant with National Instrument 43-101 standards featuring the following cut-off grades:

At a threshold of 0.5 g/t Au:

• Measured: 519,000 tonnes with an average grade of 3.08 g/t Au (51,400 ounces)
• Indicated: 7,414,000 tonnes grading 2.06 g/t Au (491,400 ounces)
• Inferred: 7,933,000 tonnes at 2.13 g/t Au (542,800 ounces)

Aggregate: 15,866,000 tonnes averaging 2.21 g/t Au (1,085,600 ounces).

At a higher cut-off of 1.50 g/t Au:

• Measured: 270,000 tonnes grading 4.99 g/t Au (43,300 ounces)
• Indicated: 2,441,000 tonnes at 5.99 g/t Au (353,900 ounces)
• Inferred: 3,438,000 tonnes grading 3.67 g/t Au (405,900 ounces)

Combined total: 2,711,000 tonnes averaging 4.56 g/t Au (803,100 ounces).

A notable challenge was that due to incomplete historical sampling under the updated geological framework, ninety-six drill core samples previously incorporated into reserve estimates were assigned zero grade values. This resulted in resource figures falling below expectations. Orex undertook resampling of these cores alongside additional zones to revise the resource assessment.

Joint Venture with Osisko

On November 12, 2009, Orex entered into an option and joint venture agreement with Osisko Mining.

The agreement's principal conditions included:

• Osisko's initial investment of $1.3 million in exchange for thirteen million shares priced at $0.10 each and receipt of thirteen million warrants exercisable at $0.125 per share over a three-year period.
• The opportunity for Osisko to acquire a fifty percent interest by committing to exploration and development expenditures amounting to $1.5 million by September 29, 2010; $3.5 million by September 29, 2011; and $8 million by September 29, 2013.
• The possibility to increase ownership to sixty percent contingent upon completing a prefeasibility study prior to September 29, 2015.

Project oversight was managed jointly through a committee equally composed of representatives from both companies with Osisko holding the deciding vote in case of deadlock.

By November 2010, Osisko had surpassed the initial expenditure milestone by investing $3.12 million and had plans for additional drilling programs underway. As of March 2011 cumulative spending reached approximately $2.93 million.

However, on September 29, 2011 Osisko allowed its option rights to lapse after failing to meet the required minimum expenditures. The company indicated that drilling outcomes suggested a smaller scale deposit more suited for selective underground or shallow open pit mining methods—an approach that did not align with Osisko’s strategic focus on larger-scale projects.

Joint venture exploration activities

On January 27, 2010, Orex and Osisko initiated their inaugural collaborative drilling program at Goldboro, employing two drills in a three-phase campaign. The initial phase, 2F, consisted of 18 holes totaling 4,728 meters and focused on deeper sections of the Ramp Area Mineral Resources, extending westward toward West Goldbrook. This was succeeded by phases 2D (28 holes, 5,492 meters) and 2E (13 holes, 2,769 meters), which continued west along the remaining 1.7-kilometer stretch of the Boston Richardson Deformation Zone, spanning from the Ramp through West Goldbrook to Dolliver Mountain.

By April 29, 2010, a total of 59 holes equating to 12,989 meters had been drilled across phases 2D, 2E, and 2F. However, a 600-meter undrilled section persisted between West Goldbrook and Dolliver Mountain.

During this timeframe, Mercator Geological Services Limited along with D.R. Duncan & Associates Ltd. completed an extensive regional synthesis covering the 960.8 km² Goldboro Extension Property. This study pinpointed key gold targets analogous to those at Goldboro, which are currently being tested through Reverse Circulation (RC) drilling to extract basal till and bedrock samples for gold assays and comprehensive whole-rock analyses. Up to this point, 194 RC holes totaling 1,513 meters have been drilled with a collection of 758 samples.

On November 18, 2010, results from 64 drill holes were disclosed, highlighting significant mineralization in twelve holes. Among these were four bedrock samples grading between 2.3 g/t and 25.65 g/t gold.

Orex announced on February 8, 2011 that Osisko would proceed with additional diamond drilling targeting ten locations: four holes west of West Goldbrook aimed at confirming the up-plunge continuation of the formation and six holes east of East Goldbrook within a newly identified 750-meter prospect zone uncovered by RC drilling. This drilling initiative began in March 2011.

By April 20, 2011, drilling operations commenced on three diamond drill holes spaced at intervals of 200 meters in the previously untested gap between West Goldbrook and Dolliver Mountain. Additionally, six holes were drilled across three sections spaced every 250 meters from East Goldbrook extending to the property’s eastern boundary. The RC drilling conducted in 2010 had suggested a mineralization trend in this sector.

On August 11, 2011, Orex and Osisko released results from this phase: ten drill holes revealed substantial new mineralization between East Goldbrook and the eastern boundary of the property. Notably, gold intersections included extremely high grades such as one interval measuring half a meter containing up to 1,570 g/t gold and another half-meter section grading as much as 410 g/t.

Independent exploration activities

In addition to its joint venture with Osisko, Orex has independently pursued exploration across multiple claims. These efforts have been directed by insights from the Regional Compilation study financed under the Osisko partnership agreement. Public disclosure on November 30, 2010 confirmed ongoing exploration activities that had been previously recognized at a local level.

At that time, Orex reported discovering new mineralization on western claims including Goldenville and Stillwater. Highlights featured a quartz vein outcrop on the Goldenville Anticline exhibiting a grade of 12.665 g/t gold alongside a nearby quartz vein measuring approximately twelve meters in width. A float sample collected near the Stillwater anticline returned a gold concentration of 0.121 g/t within an area historically known for anomalous values. Fieldwork had resumed several weeks prior to this announcement.

Geological interpretation

Situated within the Meguma Supergroup of the eastern Canadian Appalachian Belt, the property is underlain by sedimentary formations belonging to the Goldenville Group, consisting of altered greywacke, arenite (sandstone), and slate. The stratigraphic framework is shaped by the Upper Seal Harbour anticline, an ENE-oriented fold with a plunge ranging between 10° and 30° eastward, where slate layers exhibit thickening at the fold’s crest.

Although Goldboro’s mineralization was traditionally described as a “saddle reef” lode-gold deposit similar to Nova Scotia’s Boston-Richardson mine, it is actually hosted within quartz vein clusters located in anticline hinge zones, primarily within black shale-argillite host rocks. The distribution of mineralization is controlled by the fold’s flexural-slip deformation style.

Gold mineralization occurs both in quartz veins and as disseminated sulphides, predominantly arsenopyrite and native gold flakes embedded within shale-argillite wall rocks; local occurrences also affect greywacke and arenite units. Sulphide concentrations tend to be more significant in the wall rocks than within the veins themselves.

Between 2005 and 2008, Orex’s exploration efforts delineated areas where sandstone units interbedded with shale and slate host widespread lower-grade mineralization, which could be amenable to open-pit extraction.

Drilling conducted in 2010 indicated a pronounced subvertical structural control on mineralization, likely associated with subvertical shear zones.

The immediate development plan prioritizes identifying economical, near-surface open-pit resources, followed by assessment of higher-grade deposits at shallow and greater depths for possible underground mining operations—either independently or as a complement to surface mining.

Faribault

In 1885, E.R. Faribault undertook geological mapping of Nova Scotia’s gold regions for the Geological Survey Department, concentrating on the Meguma Group along the southeastern coastline. He recognized gold occurrences resembling saddle-shaped deposits along anticline crests and documented numerous ore bodies, greatly enhancing understanding of Nova Scotia’s gold distribution.

By 1893, Faribault had produced Map #27 for the Geological Survey Department, depicting extensive gold-bearing areas surrounding Goldboro. Many of these claims are now held by Orex Exploration and other stakeholders. Additionally, he prepared detailed cross-sectional profiles of both the Isaac's Harbour gold district and the Boston Richardson mine.

Nugget effect

One of Orex’s primary challenges has been obtaining accurate gold assays in these mineralized belts due to a pronounced nugget effect characterized by significant segregation. At Goldboro, gold appears as large nuggets, fine disseminations closely associated with arsenopyrite, and fine particles linked to carbonaceous material. This heterogeneous distribution accounts for why conventional assay techniques (A.A.; F.A.; metallics) frequently underestimate gold content compared to metallurgical balances derived from mill testing.

The high variability in gold particle size and spatial distribution compelled companies to adopt varied sampling methodologies and grade estimation protocols. The nugget effect is so extreme that standard analytical procedures struggle to handle samples of adequate size effectively. Sample types evaluated included:

• grab samples from surface and underground
• drill core samples from surface and underground
• drill sludge samples
• composite drill core samples
• chip samples underground
• muck samples underground
• bulk samples underground

Findings demonstrated that initial undersized samples or improper subsample sizes during crushing or grinding phases resulted in unreliable grade estimates.

Bendigo and Ballarat

When comparing the Central Victorian Goldfields in Australia with the Meguma gold deposits in Nova Scotia, several important parallels and distinctions emerge that are pertinent to gold exploration efforts. The Australian cases illustrate that narrow quartz vein gold deposits, similar to those found in Nova Scotia, can be profitably extracted. Additionally, they demonstrate that gold concentrations of relatively low grade (around 1–2 g/t Au) may still be economically feasible to mine.

Since 1851, Bendigo has produced approximately 22 million ounces of gold, while Ballarat's output since 1850 totals about 12 million ounces. Exploration activities in Australia emphasize the importance of bulk sampling for precise grade evaluation and the integration of declines as part of exploration when appropriate.

These findings point to promising prospects for discovering larger deposits within Orex's property boundaries.

High Grade versus Low Grade

At Goldboro, resource estimation relies on two distinct geological modeling techniques: (i) interpreting mineralized zones as a series of narrower, higher-grade folded belts (approximately sixteen belts), or (ii) consolidating these into broader structural domains (around four domains). The 2009 Mineral Resource Estimate was based on the first method. Both approaches identify zones of higher-grade mineralization similarly—primarily in fold hinges where dilation has occurred—although their interpretations of lower-grade material distribution differ. Evaluations indicate that both models produce comparable total contained ounce estimates.

History

A comprehensive record of mining operations and developments prior to 1915 has been compiled by Naert; a brief overview is provided here.

Boston Richardson Mine

Gold was first discovered within quartz veins along the Isaac's Harbour anticline in 1861. In 1892, Howard Richardson identified gold-bearing shale and quartz veins along what became known as the Boston Richardson Belt. Mining activities commenced that same year under the Richardson Gold Mining Company.

By 1896, production was at full scale with three shafts accessing ore at depths near 60 meters. By 1900, the principal shaft extended to 160 meters, employing selective mining techniques and two Wilfley Concentrators; an additional pair of concentrators was installed in 1901. The Boston Richardson Shaft was sunk in 1902 and remains intact today.

The Boston Richardson Mining Company took ownership in 1903, deepening the shaft to 122 meters by 1905. A bromo-cyanide processing plant constructed in 1906 enhanced gold recovery rates to approximately 70%. The main shaft reached a depth of 213 meters by 1902. Operations ended on August 15, 1908 due to financial difficulties. Subsequently, from 1909 to 1912, the New England Mining Company managed the site.

In 1926, the Metals Mining and Smelting Corporation of Canada acquired the property and attempted gold extraction from historic tailings.

Dolliver Mountain Mine

Located west of the Boston Richardson Shaft, an underground mine operated on Dolliver Mountain between 1901 and 1905. By 1902, its shaft had reached a depth of 58 meters, intersecting three ore belts including the notably wide "Partington Belt" measuring roughly 10 meters. In 1903, the shaft was extended to 81 meters, crossing through the "Forge Belt," which is about 7 meters thick. By 1904, the shaft deepened further to 149 meters; a drill hole drilled from its base in 1905 extended down approximately 152 meters and intersected additional quartz and slate formations. The mine ceased operations after 1905.

West Goldbrook Mine

Situated to the west of the Boston Richardson Shaft, five ore zones were identified at West Gold Brook Mine between 1909 and 1910. Milling trials conducted on three of these zones yielded unsatisfactory results, which led to the cessation of operations. Between 1929 and 1931, Locarno Copper Mines Ltd. developed a new shaft nearby; a metallurgical evaluation in 1931 recovered 1.61 ounces of gold per 1.1 short tons of ore processed. In 1956, Canso Mining Corporation dewatered the Locarno shaft for exploration purposes but discontinued activities due to financial limitations.

In 1907, a shaft was excavated east of the Boston Richardson shaft. By 1908, three ore belts had been located, with one containing notably rich ore, although no further development was documented. Renada Mines Ltd. dewatered the East Goldbrook shaft between 1931 and 1934 and conducted sampling within the workings, obtaining assay results ranging from 1.61 to 4.26 grams per tonne of gold.

1980 to 1989

Exploration efforts resumed in 1981 under junior mining companies. Pantino Mines Ltd. performed geophysical surveys that year and in 1984 drilled a diamond core hole measuring 529 meters on the Boston Richardson Belt. In 1985, five diamond drill holes were completed at the former West Gold Brook mine site, intersecting slate formations but yielding limited sample data.

During 1987, Petromet Resources Ltd. and Greenstrike Gold Corporation drilled an additional five holes. Subsequently, Omnitap Resources Inc. undertook an extensive campaign involving 33 diamond drill holes complemented by helicopter-borne magnetic and EM-16 geophysical surveys. This program aimed to delineate the depth and lateral extent of the Boston Richardson Belt while investigating targets beneath it and at East Goldbrook. The work resulted in identifying four new belts beneath the Boston Richardson Belt and additional belts above it in East Goldbrook, many containing significant gold concentrations with visible gold present in nearly every drill hole.

In 1988, Orex Exploration optioned the property and executed surface and underground exploration west of the Boston Richardson Mine. They discovered coarse gold within quartz veins as well as free gold in graphite-rich black shale; fourteen gold-bearing ore belts were documented. The Boston Richardson Mine shaft was refurbished to facilitate underground exploration.

Orex pursued funding from the Atlantic Canada Opportunities Agency (ACOA) to support a modern mining operation and issued tenders for Pre-Feasibility and Feasibility Studies. An access decline known as "The Ramp" was constructed to verify drilling results, accompanied by muck sampling.

Early in 1989, metallurgical testing on muck samples revealed elevated gold grades—3.3 grams per tonne via cyanidation compared to 2.0 grams per tonne determined by atomic absorption on core samples—followed by milling trials.

That year, Orex completed a Pre-Feasibility Study alongside two Feasibility Studies. The Pre-Feasibility Study recommended underground mining utilizing a gravity/flotation mill and projected earnings of $40 per ton.

The initial Feasibility Study presented three development options: two based on underground mining paired with a portable mill processing 500 tons daily, and a third combining open pit mining with selective underground mining supported by a larger mill capable of processing 5,000 tons per day. All options demonstrated economic viability; however, the open pit alternative offered the highest returns for shareholders and was thus recommended.

Later in 1989, a second Feasibility Study focused exclusively on modified sub-level retreat mining without considering open pit methods, concluding that this approach was economically feasible within available capital constraints.

Orex formally informed Nova Scotia's Department of Environment of its intention to proceed with mining operations involving open pit extraction combined with gravity/flotation and cyanide processing techniques. A public consultation addressed environmental safeguards, potential risks to streams from contamination, and plans for site reclamation.

An Economic Evaluation forecast predicted an average annual creation of 195 direct jobs and 293 indirect jobs during the initial four years, increasing to approximately 240 direct positions thereafter. The study estimated $13 million in direct economic benefits for Guysborough County over four years, $70 million in upfront capital investment for equipment procurement, and $12.8 million in yearly operational expenditures—much of which would be sourced locally—resulting in an overall community economic impact totaling $123.25 million during that period.

Between 1989 and 1990, further underground definition drilling was carried out alongside two bulk sampling programs that extracted a total of seven metric tons from underground workings.

1990 to 2004

From 1990 through 1993, exploration activities were limited due to ongoing discussions about the precise evaluation of the gold deposit’s grade, during which several technical reports were produced.

An environmental assessment carried out in 1990 concluded that "No significant adverse effects are expected."

The main challenge centered on whether the deposit was characterized by high-grade gold (evidenced by numerous nuggets) or low-grade gold (disseminated fine particles within slate formations). Traditional fire assay methods yielded lower grade results compared to metallurgical testing, which consistently showed higher values. Attempts at Continuous Grind Leach testing with Minnova Inc. did not produce satisfactory outcomes. In 1992, a Vat Leach test performed in collaboration with Novagold returned grades between 4 and 6 g/t Au with an 84% recovery rate; however, Novagold relinquished its option due to financial constraints.

In 1993, Orex conducted six diamond drill holes aimed at evaluating the high-grade resource. The findings confirmed that sampling inconsistencies were caused by the "nugget effect" and incomplete dissolution of sizable gold nuggets during cyanide processing.

In 1995, Placer Dome engaged with Orex and applied rigorous sampling techniques on stockpiled ore from 1988-89, covering four different rock types while excluding samples containing visible gold. The results were promising: Greywacke averaged 1 g/t, Slate 2.82 g/t, Quartz Vein 16.15 g/t, and vein samples reached 36.37 g/t.

Placer Dome proposed a $30 million deal for a 65% stake in Goldboro and obtained environmental clearances from Nova Scotia addressing historical mining concerns. Exploration recommenced late in 1995 using standard sampling methods but reverted to earlier low-grade outcomes. By 1996, Placer Dome withdrew its option to concentrate on international projects.

Between 1996 and 2004, the property was largely neglected; critical infrastructure suffered vandalism and most core samples were lost.

2004 to 2009

In February 2004, Orex engaged MRB & Associates to prepare an independent technical report on the Goldboro site. This effort involved a consortium of consultants including InnovExplo Inc., A.S. Horvath Consulting, Tech2Mine Inc., and MRB & Associates under the guidance of Jean Lafleur, M.Sc., Senior Technical Advisor to Orex.

The evaluation encompassed the geological framework of both the Goldboro property and the broader Meguma district in Nova Scotia, drawing comparisons between Meguma-style deposits and those found in Victoria’s Lachlan fold belt in Australia. It also scrutinized historical sampling techniques and grade estimation procedures at Goldboro with emphasis on:

• characteristics of mineralization and suggestions for future sampling strategies and QA/QC protocols;
• reliability of data for resource and reserve calculations; and
• methodological comparisons with practices employed in the Bendigo-Ballarat region.

The key insights shaped Orex’s exploration strategy in 2005, particularly Horvath’s conclusion that past sampling underestimated grades due to extreme nugget effects and that accurate grade determination necessitates metallurgical testing on sufficiently large representative samples.

Orex initiated a drilling campaign in February 2005, completing 23 diamond drill holes totaling 2,355 metres over a focused area approximately 225 metres wide around Section 8675E of the Boston Richardson belt. Core samples averaged 7.75 kg per metre drilled. The drilling targeted shallow mineralized zones with hole spacing not exceeding 25 metres; four holes were twinned for comparative purposes. Mineralized intervals underwent conventional fire assay analysis, while composite samples were forwarded to Lakefield Research for metallurgical testing. P & E Mining Consultants Inc. prepared a CIM-compliant resource estimate incorporating this metallurgical data.

In February 2008, Orex commenced an expanded diamond drilling program encompassing 12,201.5 metres across 45 holes averaging about 250 metres each, designed to infill and extend gold mineralization between West and East Goldbrook on Crown Land.

By September 2009, Orex had completed a Mineral Resource Estimate adhering to National Instrument 43-101 standards.

2006 resource evaluation

In 2006, P&E Mining Consultants delivered an updated NI43-101 compliant resource assessment grounded on drilling outcomes from 2005. This revision concentrated on a 225-meter segment within the Ramp Area, newly sampled with large-diameter boreholes. Beyond this section, along the 1.5-kilometer strike length, resources were estimated at 800,800 ounces as detailed below:

Area	Classification	Tonnes	Grade (g/t)	Oz Au
Ramp	Measured	481,000	3.40	52,600
Outside Ramp	Measured	274,000	1.21	10,700
Ramp	Indicated	755,000	2.61	183,400
Outside Ramp	Indicated	12,500,000	0.75	238,100
Outside Ramp	Inferred	15,600,000	0.63	316,000

2004 resource evaluation

In 2004, Orex engaged MRB & Associates to prepare an NI43-101 compliant resource estimate utilizing previous exploration data. The report documented a total resource of 644,000 ounces without accounting for nugget effects:

Area	Category	Metric Tonnes	g/t Au	Oz Au
Boston Richardson Area	Measured	755,000	1.21	29,300
	Indicated	12,500,000	0.75	301,000
	Inferred	13,255,000	0.78	175,500
West Goldbrook Area	Inferred	8,600,000	0.50	138,200

1990 ore reserve assessment

The Ore Reserve Calculation from 1990 estimated gold quantities ranging between 1.4 and 2.4 million ounces near the historic Boston Richardson shafts and West Goldbrook mine areas:

• Ramp Area: approximately 755,002 tonnes grading from 1.19 to 2.42 g/t
• Main Ore Body: around 19,500,000 tonnes with grades between 0.75 and 3.37 g/t
• West Goldbrook Area: roughly 8,614,817 tonnes grading from 0.53 to 0.84 g/t

The East Goldbrook zones were not included but were projected to hold an additional potential of about 10 million tons at an average grade of approximately 2.8 g/t.

1989 ore reserve assessment

St-Michel Geoconseil’s Ore Reserve calculation in 1989 for the access portal ramp area identified roughly 1,068,547 metric tonnes of ore with an uncut gold grade of about 6.2 g/t, equating to nearly 205,000 ounces of gold within the ramp zone.

1988 ore reserve assessment

In the year 1988, Narex Ore Search Consultants compiled an Ore Reserve Calculation not compliant with NI43-101 standards that estimated indicated ore tonnage at approximately 1,102,036 tons grading at about 0.194 oz/ton gold content, totaling around 213,694 ounces.

Pre-1981 production data

Reliable production records exist primarily for the Boston Richardson belt where between the years of 1893 and 1912 a total of approximately 414,887 short tons (equivalent to about 376,383 tonnes) were extracted at an average grade of roughly 0.132 oz/ton (4.53 g/t Au), yielding close to 54,871 ounces of gold. Although the head grade was approximated at around 6.8 g/t Au, recovery rates were constrained by the technological limitations of that period. Historical accounts also indicate unreported gold losses likely due to theft associated with the nuggety nature of the deposits.

External links

• orexexploration.com