Assay results could seal major Hecla/Acadia deal

It seems very unlikely that Hecla Mining, of Coeur d’Alene, Idaho, will refuse to take Acadia Mineral Ventures up on its offer to allow Hecla’s Canadian subsidiary to earn a 60% interest in the Mooseland property in Nova Scotia. Assay results from 45 of the latest holes drilled on the east side of the Tangier River, which bisects the property, have returned the best results The Northern Miner has reported from any gold property in the province.

For brevity, intersections greater than 5 ft in length are listed here:

Intersection Assay Hole (ft) (oz/ton) 28 6.33 0.29 30 9.35 0.41 31 16.96 0.50

5.74 0.13 32 5.41 0.49

15.65 0.26 35 16.30 1.24

6.24 0.57 40 5.57 0.63 41 5.58 0.11

6.49 20.04

Three steeply dipping, gold- bearing shoots have been identified along the north limb of a tightly folded anticlinal structure that has been drilled over a length of 1,000 ft and to a depth of 500 ft, according to Acadia’s exploration manager Avard Hudgins. One shoot has been identified on the south limb.

There are 3,000 ft of strike length remaining to be explored on the Acadia property.

Hecla has until the end of this month to announce its decision on whether or not to accept the deal. It would include purchasing 100,000 shares of Acadia, and paying 40% of the expenditures Acadia has incurred so far exploring the property (about $2 million), and financing all development work necessary to put the property into production. That figure has been estimated, by Acadia President Donald Smith, to be about $50 million.

Should Hecla decide to accept the deal, the company will have to announce a production decision on the property by July, 1989.

If Hecla decides not to accept the deal, Acadia would consider offers made by other major mining companies, whose terms, one source says, are as good as Hecla’s.

Acadia’s shares traded in Toronto this week at about $3.10.