Exall eyes Romanian gold

Hoping to extend its operations beyond northern Ontario and into Romania, Exall Resources (EXL-T) has begun a due diligence review of the producing Barza Brad gold mine.

Exall can earn an 80% interest in the mine by completing a prefeasibility study. State-owned Minvest, which currently exploits the Brad underground deposit, would share the remaining interest with minority Romanian shareholders.

Mining at Barza Brad dates back to Roman times. Current operations are focused on veins that are said to contain bonanza grades over considerable distances. Mapping has traced mineralized structures across the property’s surface for more than 12 km, though none of these has been explored by Western methods.

The 6-month due diligence has already seen the launch of airborne electromagnetic and radiometric surveys, to be followed by an independent review of the mine by Watts, Griffis & McOuat. The surveys, to be completed before August, will cover 12 sq. km and be flown on 150-metre line spacings.

Exall plans to finance the project with proceeds raised in a private placement with arm’s-length investors. The deal entails 8 million shares priced at 30 each and 2 million warrants exercisaable at 40 apiece within one year of the deal’s closing and at 50 in the following year.

The Toronto Stock Exchange has approved the financing.

Mining giant Rio Tinto, based in London, holds all the ground surrounding the Barza Brad concession.

East of Matheson, Ont., Exall owns a 65.53% interest in the Glimmer mine, which it also operates. In 1999, the mine cranked out 48,266 oz. at a cash cost of US$254.62 per oz. Ore is custom-milled, partially reflecting the high cost of production. The remaining interest is held by Glimmer Resources (GME-V).