Cathedral acquires option on Guyana property

Increased prices of Venezuelan concessions have prompted junior companies to investigate opportunities in neighboring Guyana and Suriname. A recent entrant, Cathedral Gold (TSE), acquired an option to earn an interest in a gold concession in the Kaburi Goldfields area of Guyana.

Although still subject to due diligence, Cathedral has the right to earn up to a 90% interest in the Kaburi-Eldorado project, 35 km northwest of the producing Omai gold mine. The project covers about 1,000 acres in an area where alluvial diggings are reported to have produced more than 150,000 oz. gold.

The property vendors have been producing gold on a small scale (fewer than 50 tons per day) and will be allowed to continue production until Cathedral completes the first stage of its option.

To earn a 75% interest, Cathedral is required to spend US$1 million on the project, and US$250,000 in option payments within four years. The company can increase this to 80% in the second stage by spending US$2 million within five years. To increase the interest to 90%, Cathedral must spend a further US$5 million within seven years.

Cathedral is best known for its 52%-owned Sterling underground gold mine in Nevada which produced 14,100 oz. through heap leaching in 1992. Reserves at year-end were 518,000 tons grading 0.18 oz. gold per ton.

Cathedral President Michael Jones said the Sterling mine began production with a small reserve more than a decade ago. “The mine has turned out 100,000 oz. in the past 12 years and still has significant potential,” he said. A drill program, planned for this year, will focus on expansion of the existing deposit. Areas outside the mine site will also be tested. Cathedral has another gold property, in the Crescent Valley region of Nevada, where the Pipeline gold deposits are situated. It may take on a major partner to continue exploration there.