Electra finds rocky road at Rambler

The unfavourable results of a due diligence review by a potential partner have prompted Electra Gold (ELT-V) not to proceed with the Rambler tailings project in the Baie Verte region of Newfoundland.

The due diligence by Pangea Goldfields (PGD-T) found that the density factor used by Electra to convert from volume to weight (cubic feet to tonnage) was incorrect. When the proper factors were used, the tonnage and grade of the gold resources were reduced substantially, rendering the project uneconomic for Electra and, therefore, of no interest to Pangea.

Meanwhile, an American company is completing a due diligence review of the Aurora partnership held by Electra’s two subsidiaries, Electra Mining and Minerex Resources.

If all goes well, the American firm will pay $20,000 and assume the debt and reclamation liabilities of the partnership, which briefly operated a small Nevada gold-silver mine. Electra says the deal, if approved, would bring it one step closer to a resolution of its financial problems and provide “a glimmer of hope” that it might survive. The junior has 6.7 million shares outstanding and trades at 2 cents.