Barrick options Rossi property in Carlin trend

In an effort to expand its holdings in Nevada’s Carlin trend, Barrick Gold (ABX-T) has entered a joint-venture agreement to explore the Rossi gold property, held by Meridian Resources (MNG-T).

Barrick will spend US$15 million to earn a 60% interest in the 28-sq.-km property, situated immediately north of the now-closed Dee gold mine and 7 km northwest of Barrick’s Meikle gold mine.

The major must spend US$10 million in the next two years, part of which will be used to construct a decline into the Storm orebody for further delineation. In the third quarter of last year, Storm was found to have a deep geologic resource of 2.8 million tonnes grading 12.7 grams gold per tonne, equivalent to just over 1 million oz. The estimate is based on 78 drillholes and a cutoff grade of 6.8 grams per tonne. Development of the exploration decline, which would start at the bottom of the Dee pit, could begin as soon as the joint-venture deal is approved by regulators.

Barrick is also to spend at least US$5 million exploring the remainder of the Rossi property.

The agreement calls for the company to process as much as 1,000 tonnes of refractory ore at its operations in the area, including Meikle and Goldstrike. Should Barrick not fulfil the spending requirement and withdraw from the joint venture, Meridian retains the right to process up to 500 tonnes at Barrick’s operation on a custom-milling basis.

Meridian’s president, Brian Kennedy, says the joint venture takes advantage of Barrick’s processing infrastructure, with no capital investment, and ensures the mine will be built with minimal capital investment. He adds that Meridian could have low-cost production coming from Rossi in as little as two years.

At 1,000 tonnes per day, the operation is expected to produce 100,000-150,000 oz. gold annually.

The Storm deposit is hosted in calcareous siltstones of the Rodeo Creek formation — the same units found at Meikle. It lies 215 metres below the surface, extends for another 200 metres at depth, and remains open to the north and south, as well as at depth.