An option to buy the La Choya gold project in Mexico was recently acquired by Hecla Mining (NYSE). Should Hecla decide to place the property into production, Dromedary Exploration (VSE) has the right to acquire a 20% working interest.
The property was previously optioned and explored by Silver Standard Resources, which backed out earlier this year after being unable to negotiate more favorable terms of a purchase agreement with the property’s owners. Situated less than 30 miles from the Arizona border, La Choya is reported to host a reserve of 3.2 million tons, minable by open pit method, grading 0.042 oz. gold per ton. The property is also considered to have good potential for discovery of additional reserves.
A program of infill and stepout drilling is about to begin on the property, to be carried out in conjunction with engineering and metallurgical studies. Once a feasibility study is completed in an estimated 6-8 months, Dromedary must choose between participating in the project at 20%, or accepting a production royalty to a maximum of $300,000.
Gerald Carlson, president of the Vancouver-based junior, said the opportunity to participate in the project came about from its introduction of the property to Hecla.
In other news, Dromedary terminated an option on the Boise Queen property in Idaho.
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