Goldcorp invests $15.6 million in Evolving Gold

Although the Evolving Gold (EVG-V) team consists of several former Newmont Mining (NMC-T, NEM-N) people, it’s Goldcorp (G-T, GG-N) that has decided to invest $15.6 million in the junior gold explorer.

Goldcorp is buying 19 million Evolving shares at 82¢ apiece in a private placement – a significant stake in a company that currently has 107.2 million shares outstanding and a market cap of $85.8 million.

Evolving president and chief geologist, Quinton Hennigh, who used to work for Newmont, says Goldcorp had no prior interest in Evolving until now.

“I can’t speak on behalf of Goldcorp but I would say there was a lot of intrigue with the fact that we have a large land position in the Carlin trend,” Hennigh says.

Evolving will use the funds to explore its Rattlesnake Hills project in Wyoming and its Carlin and Humboldt projects in Nevada. Rattlesnake Hills is a former Newmont project and Evolving has a lease and sublease agreement with Newmont for the Carlin property. Humboldt was acquired from private landholders and has no connection to Newmont.

Evolving shares were trading around 80¢ at mid-day today, down 6¢, on a trading volume of 652,000 shares.

Once the money comes in from Goldcorp, Evolving will have $27 million in the bank giving the company enough cash to stretch well beyond this year’s $8-million-or-so budget.

“We plan to do the hard work and use this money effectively and make what could be a very huge discovery,” Hennigh says.

Located around and adjacent to the Carlin property, the 93-sq.-km Humboldt land was acquired by Evolving in early May bringing the total Carlin-area land holdings to 137 sq. km.

Evolving has the option to earn a 100% interest in Humboldt by spending US$9.7 million over four years – a much better deal for Evolving than the Carlin property, which includes significant claw back provisions for Newmont.

“It positions us better in terms of any exploration done. We stand to gain much more now,” Hennigh says. “We know there is gold mineralization in this area and we feel pretty good of our odds of finding a discovery on the property.”

Evolving is currently drilling in both Nevada and Wyoming. The company has budgeted about $4 million for Nevada with five or six holes planned for Humboldt and two or three holes for the Carlin property, each between 700 metres and 1,200 metres deep.

Evolving is drilling now at Humboldt. The company has outlined 16 targets based on a geophysical survey.

Up in Wyoming, Evolving has already started a 20,000-metre drill program at Rattlesnake Hills where about 60% of the drill budget will focus on infill and step-out drilling around the North Stock and Antelope Basin zones.

For the rest of the drilling, Evolving plans to test some new targets that were identified by surface sampling and mapping in 2009.

All the targets are located within a 2 km radius of North Stock and Antelope Basin.

The company drilled 78 holes there last year amounting to nearly 30,000 metres, and 15 holes (6,500 metres) in 2008.

Evolving is expecting a National Instrument 43-101 technical report update on Rattlesnake Hills to come out very soon.

Much of the company’s exploration strategy comes from the AMEC technical report that hasn’t been released yet.

Hennigh says both AMEC and Evolving have been too busy recently to put the finishing touches on the report. He expects it will be complete by the end of July.