Virginia forms alliance with Noranda (June 18, 2001)

With dozens of projects on the go, Virginia Gold Mines (VIA-T) is doing more than its share to keep exploration alive in the vast wilderness of northern Quebec. The junior is also receiving financial and strategic support from a major that knows the province well — diversified miner Noranda (NOR-T).

Under the terms of their recent “strategic alliance,” Virigina and Noranda will jointly conduct geoscientific work on ground covering 3,600 sq. km. in the province’s central or northern region. Virginia President Andre Gaumond says the exact location of the land package is “confidential,” though he did confirm that exploration is aimed at base metal targets.

Noranda has already completed a private placement of 633,333 Virginia shares priced at $1.50 each, for gross proceeds of just under $1 million.

The proceeds will be used to complete the first phase of exploration work, budgeted at $1.9 million. The major can acquire a 55% interest in any target generated by the work programs. Once this interest is earned, Noranda will take over as operator.

Virginia holds numerous other properties in northern Quebec, including joint ventures focused on gold-bearing and polymetallic targets in the James Bay region. These projects are not affected by Virigina’s newly formed relationship with Noranda.