Serem adds to Cheni Gold position

French government-controlled Serem has bought an additional 1.4 million shares of Cheni Gold Mines (TSE) in accordance with a 1992 subscription agreement.

Serem, which is based in Paris, can buy up to 15 million common shares of Cheni at either 71 or the Canadian equivalent of 3.3 French francs per share, whichever is greater.

The company bought 1.4 million shares earlier this year at 75.5 per share and completed the recent placement at 77.7 per share.

The second purchase under the subscription agreement raises the groups total holding to 6.7 million shares, or about 48% of Chenis issued capital. Including the placement, Cheni has about $400,000 in working capital and $4.9 million in long-term debt. (Not included in those estimates is a $3.7-million government assistance loan, due only if the combined price of one ounce of gold and 50 oz. of silver totals US$868.)

Work on the companys Lawyers property in north-central British Columbia this year included $300,000 in exploration plus about $300,000 in site reclamation. The program included infill drilling on the Dukes Ridge zone, but the company failed to outline sufficient mineralization to make the deposit economic. In light of the mixed results, Cheni does not plan to conduct any further work in 1993.

Also, the company was unable to negotiate an extension to the option agreement held on the nearby Mets property. Mets, which contains an estimated diluted reserve of 58,000 tons grading 0.35 oz. gold per ton, is jointly owned by Golden Rule Resources (TSE) and Manson Creek Resources (TSE).