Westmin to joint venture SB project with Tenajon

The property is strategically located on the Granduc Road some four miles west of Westmin’s 50.1%-owned, 2,200-ton-per-day Premier Gold mine now in its start-up phase.

Earlier this year Tenajon acquired a 50% interest in the SB project from Esso Minerals Canada for $2.14 million to bring its interest to 100%

The SB property is reported to contain four known zones of mineralization. Probable and possible reserves were calculated for two of the zones and total 308,000 tons with an average grade (uncut) of 0.505 oz gold and 1.07 oz silver per ton. Both zones are open in at least two directions.

The agreement is still subject to the satisfactory completion of a due diligence study by Westmin, but Tenajon said this work is primarily to “confirm preliminary metallurgical testing which has indicated the compatibility of SB and Premier ore.”

Westmin’s expenditure of $2.4 million will earn it a 50% interest in the property and a 50-50 joint venture. Under the terms of the agreement, Westmin has assured the joint venture access to the Premier mill at a guaranteed minimum rate of 330 tons per day and preferred inclusive milling costs current ly estimated to be about $22 per ton.

After completing its due diligence Westmin will take over as operator of the SB project and spend a minimum of $1.05 million within four months of the execution of the agreement.

Westmin will also make a $572,500 cash payment to Tenajon, of which $400,000 is considered an interest free loan repayable from future production revenue.

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