As part of the reorganization, 750,000 shares of Costigan will be issued and placed in escrow bringing its total issued capital to 3,010,594 common shares and 61,775 preferred shares. As a condition of the private placement, the company’s creditors have agreed to a settlement. Subject to regulatory approval, creditors will accept one- quarter of the amounts owing to them in cash, and the balance payable in shares at a rate of 45 cents per share for a total of 101,853 shares of Costigan. The claims to be drilled, known as the Evandale property, host both base and precious metal mineralization ove r narrow widths in altered granite rocks. Previous drilling by another company in 1979 yielded 0.7 ft grading 0.47 oz gold per ton, 9.4 oz silver, together with 2.41% copper, 6.67% zinc and 4.74% lead.
Costigan has carried out geochemical and geophysical surveys over part of the property, and a diamond drilling program is planned to follow-up gold and base metal targets.
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