A deal to acquire two properties in French Guiana has been signed by Golden Star Resources (TSE).
The first property, known as St. Elie, covers 39 sq. miles (100 sq. km) and was formerly the largest producing gold mining area in the region. More than 600,000 oz. were mined between 1878 and the early 1950s, Golden Star says. The Edmonton-based company bought St. Elie for US$1.1 million, as well as an option for a 100% interest on the second property, known as Esperance. It can acquire Esperance by completing a feasibility study within five years and paying Compagnie Miniere Esperance US$3 per oz. of contained gold. The property covers 19 sq. miles (50 sq. km) in an alluvial gold-producing area. French Guiana combines a favorable geological environment with strong investment incentives as a part of the Republic of France, according to Golden Star.
At Gross Rosebel in Suriname, the company began core drilling in February at the Royal Hill zone and continues to do so at Mayo. Three additional diamond drills have been acquired to accelerate exploration.
In a first-stage program at Royal Hill, 23 holes were drilled, which confirmed the widespread nature of mineralization indicated earlier by trenching. Gold values were low, with the longest lateritic intersection grading 1.1 grams per ton over 29.8 metres. Golden Star is compiling data to set a course for the next phase.
Meanwhile, a loss of US$1.6 million (10 cents per share) has been posted for the first quarter. This includes a $1.1-million loss representing Golden Star’s equity interest in the Omai gold mine in Guyana. (Its partner in the project is Montreal-listed Cambior Inc.)
The mine ran into start-up problems earlier this year, but these have been overcome, Golden Star says. Gold production increased to 18,807 oz. in April from a meagre 6,493 oz. in January. The 1993 target is 260,000 oz. at an operating cost of US$200 per oz.
Golden Star recently cut its 35% stake in Omai to 30% when Cambior exercised its option to acquire an additional 5%.
Be the first to comment on "Golden Star locks up golden deal"