X-Cal options remainder of Sleeper mine in Nevada

Vancouver-based X-Cal Resources (xcl-v) intends to buy the remaining half of the Sleeper gold mine that it does not already own. The mine is in northern Nevada.

The junior acquired a 50% stake in the operation from owner Amax Gold (au-n) in April 1996. In return, X-Cal agreed to spend US$2 million on exploration and surrendered 1 million of its shares.

The recent agreement calls for X-Cal to make payments totalling US$100,000 in cash and stock in return for a 90-day option to buy the remaining interest. The option period can be extended to 135 days in return for an additional payment equivalent to US$250,000.

Revenue from the current heap-leach operation will be shared equally until after the sale. X-Cal will then begin receiving 100% of revenues, provided it can obtain permits to continue leaching.

X-Cal believes it can locate sufficient additional reserves to continue operating. Already, a resource at the West Wood target, adjacent to the current pit, has been located, though grade and tonnage estimates are not yet available.

The company is also investigating other targets on the 12,000-acre property.