A letter of intent to launch a $3-million underground exploration program at the Kerr gold mine of Deak Resources (TSE) at Virginiatown, Ont., has been signed by Deak and Cyprus Canada, an affiliate of Cyprus Minerals (NYSE).
The proposed 4-year option deal would earn Cyprus a 50% interest in specific portions of Deak’s claim group south of and adjacent to Deak’s current mining operations.
Cyprus says it intends to drill major unexplored horizons from underground south of the mine where four geological structures have been identified at surface and underground. These structures would be accessible from the existing mine infrastructure. Cyprus hopes to spend at least $600,000 within the next year.
Deak already has a joint venture agreement with Kennecott Canada under which a drilling program is being carried out to the east of the mine. Deak is drifting out on its 2,650 level to continue the exploration at depth in this area.
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