An agreement has been signed by Exall Resources (TSE) and Britannia Gold (VSE) for a joint venture on the Santo Tomas copper project in Sinaloa state, Mexico.
Under the agreement, Britannia will assume the property’s present liabilities, about $2 million, to earn a 30% working interest. The company will also fund a bankable feasibility study on the deposit to earn another 30%. The project will be jointly managed.
The deposit has reserves in all categories of 829 million tonnes grading 0.32% copper, with a minable reserve in the north pit of 300 million tonnes at an average grade of 0.51% copper.
Exall received estimates from its consultant, Bechtel Corporation, which indicated that performing a final feasibility study would be more costly than expected. The farm-out agreement allows Exall to keep a large interest in the property, while still providing cash for a feasibility study.
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