The move enables EM to postpone payment of US$250,000, which was due in early October, the first anniversary of a US$2.5-million agreement to buy Rio Tinto’s Canoas I and II concessions in southcentral Ecuador.
The downside is that EM will now have to make a higher payment of US$500,000 upon completion of a feasibility and spend at least US$500,000 on exploration in the next 12 months.
Cash payments include US$350,000 due in 2000, US$800,000 in 2001 and US$1 million in 2002. Also, Rio Tinto has a 2% net smelter return royalty on commercial production.
Recently, a 21-hole drill program at Beroen encountered several intervals of bonanza-grade gold-silver mineralization, including 35 metres grading 8 grams gold per tonne in hole 2. Other highlights were hole 5, which hit 16 metres of near-surface mineralization grading 24.9 grams gold and 189 grams silver, and hole 4, which returned 32 metres of 2 grams gold.
EM also intercepted significant, though slightly lower-grade, mineralization in the Dorada zone. Results include: hole 17, which cut 41.1 metres of 2.1 grams gold; hole 18, which hit 32.7 metres of 3.5 grams gold; and hole 21, which returned 35.5 metres of 2.6 grams gold.
The results contributed to an in-house resource estimate of 1.8 million oz. gold-equivalent within 9.4 million tonnes averaging 6.1 grams per tonne.
Most of the resource is in the Alejandra zone, which consists of 4.7 million tonnes grading 7.5 grams gold and 67 grams silver, equivalent to 1.1 million oz. gold and 10 million oz. silver.
The Dorada zone, 1 km to the south, contains 4.7 million tonnes of 3.1 grams gold and 18 grams silver, equivalent to 470,000 oz. gold and 2.7 million oz. silver.
EM plans to drive a series of adits into the Alejandra zone to obtain an underground bulk sample. Development drilling is slated for 2000.
Meanwhile, EM has begun drilling at the Vetaspata gold project in southern Peru. The company will drill 20 core holes from surface to evaluate the continuity of gold-bearing mantos.
Be the first to comment on "Ecuadorian defers payment"