An exploration program being carried out by Noranda Exploration Co. on Central Crude’s 118 gold claims in the Mishibishu Lake area of northwestern Ontario, will be extended to include the adjoining 163 claims held by Hemlo Gold Mines.
Hemlo Gold, owned 50% by Noranda, will take over Noranda’s option to earn a 60% interest in Central’s property by spending $1 million on exploration on both claim groups by September, l989, and paying Central $90,000 in cash by September, l988. Central Crude will pay its proportionate share of the acquisition cost of the new claim group. Norex will continue as operator.
Preliminary work on both prospects has been encouraging (N.M., June 1/87). The structure located on the original Central claims has been traced for an additional length of approximately 4.5 miles and five new gold showings have been located with grab samples returning 0.034 to 0.272 oz gold per ton. Drilling will begin shortly.
Central has agreed to a private placement with a limited partnership, nim Resource 1987 and Co., for up to 250,000 common shares at $2 per share. These funds will be used by Hemlo through its operator Norex for current work on Central’s original claims. Central will be credited when a joint venture is formed. The company has also reached an agreement with nim to draw up to $2 million by issuing flow-through shares at a price to be determined for the 1988 exploration season. Both agreements are subject to regulatory approvals.
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