GOLD AND PRECIOUS METAlS — Triton intends to option Manantial Espejo property

Triton Mining (TTM-T) has agreed to option a 50% interest in its 80%-owned Manantial Espejo gold-silver property in Argentina to Global Explorations (GXC-V).

The terms of the deal, outlined in a memorandum of understanding signed by the two companies, call for Global to make a US$1.5-million payment to Triton within two months of signing the agreement and to spend at least US$2 million on exploration within the first year. Global must also complete a bankable feasibility study at a minimum annual production of 75,000 gold-equivalent oz. within 30 months.

The transaction is subject to Global raising a minimum of US$3.5 million as well as the completion of the formal option agreement and approval from the Vancouver Stock Exchange.

The current proven and probable reserve estimate at Manantial Espejo is 3.9 million tonnes grading 3.1 grams gold and 132.7 grams silver per tonne, all of which is amenable to open-pit mining methods. A prefeasibility study based on a 1,500 tonne-per-day operation with gold and silver recovery estimated at 95% and 85% respectively indicated life-of-mine cash costs would be roughly US$188 per oz. gold.

Barrick Gold (ABX-T) holds the remaining 20% interest in Manantial Espejo.

In other news, the company entered into another loan agreement with Black Hawk Mining (BHK-T) under which that company will loan Triton US$1.5 million for six months, charging interest at Canadian Imperial Bank of Commerce US-dollar prime plus 2%. In addition, Black Hawk has been granted 1.5 million warrants, each of which is redeemable for one Triton share at 40cents for one year. The funds will go toward the development of Triton’s Limon gold mine in Nicaragua.

A previous loan arrangement, made in April, was for US$1.5 million at the same interest rate for one year. At that time, Black Hawk also received 1.5 million warrants exercisable at US40cents for two years.

Black Hawk and Triton are in the process of a share-for-share merger which is still subject to shareholder approval. If the merger is accepted, both loan agreements will be cancelled and Triton will become a wholly owned subsidiary of Black Hawk.