The U.S. subsidiary of Placer Dome (TSE) has signed a property agreement with Cathedral Gold (TSE) and Imperial Metals (TSE), owners of 90% and 10%, respectively, of the Sterling mine in Nevada.
The agreement gives Placer the right to earn a 65% interest in the Sterling joint venture and 55% in the adjacent Goldspar property.
Placer will initially pay Cathedral and Imperial US$10,000, prior to a 60-day period during which time Placer will develop exploration targets.
Placer sees potential in developing deep sulphide reserves below the existing oxide gold deposits.
At last report, the Sterling mine had proven reserves of 40,700 tons grading 0.25 oz. gold per ton plus probable reserves of 88,600 tons grading 0.24 oz. gold.
To continue with the option after the 60-day period, Placer must commit to a minimum US$150,000 exploration program, for completion before 1997.
The major will be required to spend a minimum of US$300,000 per year in subsequent years.
To earn its interest in either of the properties, Placer must complete a positive bankable feasibility study on a deposit measuring at least 750,000 oz. of payable gold.
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