Trilogy Increases 2019 Upper Kobuk Exploration Budget

Rick Van Nieuwenhuyse, President and CEO of Trilogy Metals commented, “As an exploration geologist, I am very excited that the Technical Committee and South32 have agreed to equally fund a $2 million exploration program along the Ambler VMS belt. The program will include a VTEM airborne geophysical survey along the entire belt. Follow-up ZTEM may be flown in certain areas. High priority targets will be evaluated with follow-up drilling. There are dozens of known VMS prospects along the 75 mile-long Ambler Belt including many with historic resources. It is exciting to be drilling new exploration targets again. We are confident that we can find additional high-grade polymetallic resources along this prolific mineral belt.”

Ambler VMS Belt

The Ambler mining district is located on the southern margin of the Brooks Range. Within this VMS belt, several deposits and prospects (including the Arctic Deposit) are hosted in the Ambler Sequence, a group of Middle Devonian to Early Mississippian, metamorphosed, bimodal volcanic and volcaniclastic rocks with interbedded siliceousclastic, graphitic, and calcareous metasediments. The Ambler sequence occurs in the upper part of the regional Anirak Schist. VMS-style mineralization is found along the entire 110 km strike length of the district. In addition to the Arctic Deposit, numerous other VMS-like occurrences are present on the Trilogy Metals land package. The most notable of these occurrences are the Dead Creek (also known as Shungnak), Sunshine, Cliff, Horse, and the Snow prospects to the west of the Arctic Deposit and the Red, Nora, Tom-Tom and BT prospects to the east (Figures 1 and 2).

Generally, VMS belts host clusters of deposits that can range from 1 million tonnes to over 100 million tonnes, and can contain high-grade copper, zinc, lead and precious metals. Some of the most prolific base-metal mineral belts in the world are within VMS districts such as the Flin Flon Belt of northern Manitoba, the Iberian Pyrite Belt in Spain and Portugal and the Noranda area of Quebec (Figure 3).

The company is well financed to complete these programs. With cash and cash equivalents at its fiscal year-end over $20.0 million and the funding from South32 of $10.2 million, the company has over $30.0 million to advance the UKMP Projects. Trilogy also has 6.5 million warrants held by large shareholders expiring on July 2, 2019, at an exercise price of $1.52 which is below the company’s current trading price. Trilogy would receive an additional $10 million with the full exercise of the warrants.