For a half interest in the Goldbanks gold property near Winnemucca, Nev., Kinross Gold (TSE) will pay Restoration Minerals, a small private company, US$6 million and 800,000 shares of Kinross stock.
Kinross will manage and operate the open-pit, heap-leach operation and finance all preproduction capital.
The minable reserve is estimated at 47 million tons grading 0.027 oz. gold per ton, plus another 36 million tons of “lean ore” grading 0.007 oz.
Since 1986, more than 400 holes have been drilled in the Main zone, and further drilling across the 10,000-acre property has identified six satellite zones of mineralization.
Plans call for ore to be processed by standard heap-leach methods, with the aid of a Merrill-Crowe gold and silver recovery system. On a yearly basis, about 6 million tons will be treated to produce 150,000 oz. The mine life is expected to be eight years.
Deep drilling has intersected higher-grade structures at 1,500-2,000 ft. below surface, where a feeder zone for the gold system is believed to exist. Additional drilling will test the deep potential for mineralization.
The preproduction cost is projected at US$35 million.
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