Vancouver – Pacifica Resources (PAX-V) and the Howard’s Pass joint venture have hammered out a deal that could see Pacifica earning a 100% interest in the old Howard’s Pass project in the Yukon.
The company has signed a letter of intent that will form the basis of a definitive purchase agreement between itself and the Howard’s Pass Joint Venture which comprises partners Placer Dome (PDG-T) and Cygnus Mines.
Pacifica will have an option to purchase 100% interest in the land covered by the joint venture for $10 million over a 7-year period, with staged payments to be made on a yearly basis.
In addition, Pacifica must spend $3.5 million on exploration over the first two years of the deal.
The joint venture retains a 2% net smelter return royalty on production and get another $10 million from net proceeds of production. Placer and Cygnus may re-invest their purchase payments in shares of Pacifica to hold a maximum of 20% of the company’s total shares.
Howard’s Pass is a sedimentary exhalative-style lead-zinc deposit situated in the Selwyn Basin of the eastern Yukon near the border with the Northwest Territories. The strata in the basin are gently folded and offset by faults.
The company already holds a 35-km stretch of the favourable shale unit which hosts the deposit.
Considered one of the largest undeveloped zinc resources in the world, Howard’s Pass has a historical resource of 115 million tonnes averaging 5.4% zinc and 2.1% lead in the XY and Anniv deposits on the property.
Pacifica is planning a drill program this summer to define the resource potential of the district and plans to focus on expanding the higher grade XY resources. The company is working towards raising the funds needed for exploration this year.
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