Equinox assumes Rosebud ownership

Having bought a 51% interest from Lac Minerals (TSE), Equinox Resources (TSE) is now sole owner of Nevada’s Rosebud property.

The company paid US$5.5 million for the interest, $3 million of which was raised by selling a 2.5% net smelter return to Euro-Nevada Mining (TSE). The balance came from a $9-million placement at $3 per share.

Euro-Nevada has an option to buy a further 1.5% net smelter return in the property for US$2.5 million.

Equinox plans to launch a final feasibility study, including underground development, in-fill drilling and bulk-sampling. The US$5-million underground program is to start in October and will last about a year.

Work to date has outlined a probable resource of about 1.8 million tons grading 0.33 oz. gold and 2.3 oz. silver per ton.

Based on current reserves and a 7-year mine life, the operation should produce about 75,000 oz. gold per year.

Preliminary estimates, based on a 1,000-ton-per-day operation with an on-site mill, put the capital cost at US$28 million. The estimated capital cost drops to about US$6 million based on custom milling the Rosebud ore at one of the numerous gold mills located in the region.

Equinox currently has about $6.2 million in working capital.