Vancouver — Shelving a proposed merger agreement, juniors National Gold (NGT-V) and Alamos Minerals (AAS-V) have elected to enter into a joint venture agreement over the Salamandra gold property in Mexico’s Sonora state.
Alamos can earn a 50% stake in the advanced project by spending $2.375 million over the next 12 months. As part of the deal, National Gold will receive a $2 million payment should the property enter profitable production.
The Albert Matter-led junior acquired the advanced project late last year from Placer Dome (PDG-T) and Kennecott Minerals in a $10.5-million deal. Finding it difficult to raise the financing required to advance the project, National Gold began shopping for a joint venture partner almost immediately. The latest deal replaces a July proposal to merge the two juniors.
Situated some 400 km south of Tucson, Arizona, the promising property hosts the 3.4-million oz. Mulatos gold deposit. Placer and Kennecott spent over $50 million exploring the 151-sq.-km property since 1993. A 1997 feasibility study pegged the measured and indicated resource at 68.3 million tonnes grading 1.57 grams gold per tonne using a 0.8 gram gold cut off. Included in this is a higher-grade core of 11.5 million tonnes grading 3.2 grams gold.
Held 70% by Placer and 30% by Kennecott (a subsidiary of Rio Tinto (RTP-N)), a 1999 feasibility study envisioned a 17,500-tonne-per-day open-pit operation. Capital costs came in at US$120 million with operating cost hitting US$5 per processed tonne at a gold recovery of 66% for the heap leach operation.
Mineralization is hosted in a large high sulphidation gold system that is found preferentially stratabound in felsic volcaniclastics and porphyritic flows. Alteration is well zoned going from a gold-bearing core of silicic and pyrophyillite clays to kaolinite-illite-dickite clays and finally to a propylitic zone.
Chester Millar-led Alamos will begin drilling the property immediately.
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