Canarc in control of Polaris-Taku

The purchase of a controlling interest in Rembrandt Gold Mines (ASE), along with a fully diluted 43.6% controlling interest in Suntac Minerals (VSE), has given Canarc Resources (VSE) and its principals indirect control of the Polaris-Taku gold mine in northwestern British Columbia.

Suntac has an option to earn a 60% interest in Polaris-Taku from Rembrandt. Canarc acquired 500,000 units of Rembrandt through a private placement at 50 cents per unit. The units include a share plus one warrant to purchase an additional share at 50 cents in the first year and 55 cents in the second year.

The placement gives Canarc a 12.8% interest in Rembrandt, increasing to 22.7% on the exercise of the warrants.

Two principals of Canarc, Bradford Cooke and Bradley Aelicks, previously acquired and now own 300,000 shares of Rembrandt representing a 7.7% interest. In addition, Cooke and Aelicks have reached an

agreement-in-principle with five Rembrandt shareholders to acquire a further 800,000 shares representing 20.5% of the company’s outstanding shares. Consequently, Canarc, Cooke and Aelicks will jointly own 1.6 million shares of Rembrandt or 41% of the company. On a fully diluted basis, the three will have a 47.7% interest in Rembrandt.

Suntac recently completed a $1-million first-phase exploration program on the Polaris-Taku property and although the company has spent in excess of the $3 million required to earn the interest, it must also complete a feasibility study before becoming fully vested.

Bradford Cooke, president of Canarc, noted that although a feasibility study could be completed on the Polaris-Taku based on a “minable” reserve estimate of 244,000 tons grading 0.33 oz. gold per ton, the companies have opted to develop a larger reserve with a target of one million contained ounces of gold.

Drilling to date has outlined preliminary reserves totalling about 1.9 million tons grading 0.47 oz. gold.

Cooke added that the reserve estimate includes only the Y and C vein intersections and none of the multiple-vein intersections indicated in a number of the holes.

Previous mining at the Polaris-Taku extended to 500 ft. in depth while the Y and C veins have been traced to a vertical depth of up to 1,000 ft. and along a strike length of about 1,500 ft.

Cooke said the two veins average about 11 ft. in width and remain open along strike and to depth, leaving ample potential for additional reserves. He also noted that grades appear to increase with depth.

Results from the first phase of this year’s drilling are now being compiled and interpreted before a second phase of drilling starts in late September. Over the longer term, Cooke said the companies may be combined at some point to consolidate the ownership of the property and facilitate its potential sale to another company.

Cooke expects property expenditures to reach up to $5 million next year with the start of an underground program and project feasibility study.