Shareholders of Atlanta Gold (TSE) voted in favor of optioning the company’s Idaho properties to a unit of Newmont Mining (NYSE). Newmont can earn a 51% interest by making staged cash payments totalling US$5 million and by spending US$10 million on exploration and development to Dec. 31, 1995.
A cash payment of US$250,000 is due with the signing of the option to be followed by US$500,000 on each of Aug. 1, 1991, and Jan. 1, 1992.
A further cash payment of US$1 million is due on Jan. 1, 1993, followed by US$500,000 on each July 1 and Jan. 1 thereafter until the cumulative total is US$5 million.
A technical feasibility study previously done on the project estimated surface reserves at 8.3 million tons of refractory ore grading 0.087 oz. gold and 0.23 oz. silver per ton.
The first phase of Newmont’s program will begin in early 1991 and include about 15,000 ft. of drilling at a budget of about US$550,000. Newmont is primarily interested in the property’s potential at depth for high-grade gold zones.
If the first phase is successful, a second-phase program will follow, including about 16,000 ft. of drilling.
The option agreement includes a clause allowing Atlanta to dilute to a minimum 30% interest with Newmont funding the project to production.
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