High River boosts Taparko stake (June 28, 2002)

High River Gold Mines (HRG-T) has exercised its option and picked up another 18.5% interest in the advanced Taparko gold project in Burkina Faso, West Africa from Queenstake Resources (QRL-T).

To do so, High River paid $1.2 million, re-negotiated down from the option’s original $1.4 million price tag.

The deal is slated to close by July 15, and will boost High Rivers stake in the project to 80%. The government of Burkina Faso holds the remaining 20%.

High River has begun a US$500,000 exploration program focused on turning up new near-surface gold resources. The program includes core, reverse circulation and reverse air blast drilling on and around the Taparko shear, which hosts the property’s known gold resource. Some holes will also target the previously identified Zemce and Goengo-Kangarse prospects, not on the shear.

Resources at Taparko currently stand at 12.6 million tonnes grading 2.6 grams gold per tonne, at a cutoff grade of 1.0 grams of gold per tonne.

Recently, the government of Burkina Faso extended to November 2003 the deadline for High River’s development decision at Taparko.

High River also reports that Axmin (AXM-V) is in the midst of a program of reverse circulation drilling on the nearby, 275-sq.-km Bouroum property. The drilling is designed to further define resources and better delineate the high-grade zones for a prefeasibility study. Metallurgical and geotechnical studies are also planned.

Axmin picked up a 90-day option on Bouroum from Channel Resources (CHU-T) by spending $20,000 in cash and can exercise it for another $55,000. Channel is carried for a 35% interest until Axmin tables a bankable feasibility study. If Axmin decides to proceed with development, it will buy out Channel’s pro rata interest in the property’s proven and probable reserves. Axmin has committed to spend at least US$250,000 on exploration at Bouroum.

An independently reviewed estimate of resources at Bouroum stands at 2.3 million tonnes grading 3.1 grams of gold per tonne in the indicated category. Another 2.6 million tonnes running 2.8 grams of gold are classified as inferred. Both calculations employ at cutoff grade of 1 gram gold.

High River and Axmin are looking at developing their respective projects in tandem and the two have signed a deal to complete a prefeasibility study of a joint operation. Previous work at Bouroum indicated the potential for higher-grade mineralization amenable to open pit mining, which could be trucked to Taparko.

The deal calls for the exchange of data and sharing of costs of the pre-feasibility study, which will jointly managed, but undertake by independent mining consultants. The ownership structure of the joint mining project will be based on the contributions from each property.

The companies figure combined annual production from the two properties, about 35 km apart, could reach as high as 100,000 ounces. The properties are 165 and 200 km, respectively, northeast Burkina Faso’s capital city Ouagadougou.