Eureka Resources and Southlands Mining Corp. recently concluded a joint venture agreement to develop Eureka’s Frasergold Precious Metals project near Williams Lake, B.C.
Under the agreement, Southlands can earn a 50% working interest in the project by providing $3 million for development and a feasibility study over three years.
Vancouver-based Eureka has the option, after a feasibility study is complete, to participate in production on a 50-50 basis by contributing 50% of costs or to participate in 50% net profits after recovery of capital costs.
Eureka President Jack O’Neill said the 1987 development program is well organized and the initial camp and crew are to mobilize early in June.
Drilling will start on July 1 and the underground development adit is scheduled to start on July 20. A unitized pilot mill is to be on-site and processing ore from the adit at a rate of 20-25 tons per day by mid-Aug ust. A total of 1,000 tons of ore is to be processed during 1987.
The $1-million pilot mining and milling program is designed to establish total and recoverable values of gold from large bulk samples of ore, according to Mr O’Neill.
“This data, related to assay results of 1987 and previous drilling, will establish reliable estimates of gold content within the Frasergold Deposit,” he said.
Mr O’Neill added that previous drilling has identified 20 million tons of open-pit reserves grading 0.06 oz gold per ton, including 1.2 million tons of narrow width underground potential, grading 0.40 oz.
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