A newly formed subsidiary of BYG Natural Resources (TSE) will take over that company’s exploration properties, so that BYG itself can concentrate on advancing its Mt. Nansen gold-silver property in the central Yukon.
The new company, 13733 Yukon Inc., will take over the Tawa property, which lies north of Mt. Nansen, as well as the Arctic mine, in the Wheaton River area north of the British Columbia border.
The new company will also take a private placement of 3 million shares of Vancouver-based Omni Resources (VSE) at $1 per share. Attached to the shares are 3 million warrants convertible to shares at an exercise price of $1.50; exercising all these warrants will give the new company a half interest in Omni’s properties in the Wheaton River area.
Omni’s properties include: the Mt. Skukum gold property, a gold producer from the mid- to late-1980s; the Skukum Creek property on Mt. Skukum’s southern boundary; and the Goddell Gully property to the east. The 300-tonne-per-day Mt. Skukum mill is included in the deal.
Omni will use the initial infusion of cash to drive a decline at the Goddell property in order to investigate a mineralized structure grading 3.9 grams gold per tonne over 34 metres and 4.6 grams over 64 metres (as well as higher grades over narrower intervals). The company will also explore Skukum Creek, which has a proven and probable reserve of 466,000 tonnes grading 7.6 grams gold and 274 grams silver.
Shares in BYG’s new company will be distributed to the company’s shareholders at the rate of one Class A share for every 10 BYG shares. BYG will retain about 4 million Class B shares, representing about 50% of the new company’s capital and providing voting control of the stock.
At the Mt. Nansen deposit, BYG has received its final approval and water licence. Open-pit stripping and construction of the tailings dam are scheduled to start in May, with production starting in August. BYG will increase daily production to 700 from 500 tonnes.
BYG has a $2.5-million loan from metal trading firm Gerald Metals, which will have a contract to sell and refine gold and silver from Mt. Nansen.
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