Vancouver – Having resumed exploration activities on its Mt. Kare property in Papua New Guinea, Madison Enterprises (MNP-V) has expanded its portfolio by inking a deal to earn a 75% stake in the Lewis gold property on the Battle Mountain trend in central Nevada.
The 30-sq.-km project lies immediately north and northwest of Newmont Mining‘s (NEM-N) 9 million oz. Phoenix property. Previous exploration identified several zone of gold mineralization hosted in a similar geological environment to other deposits in the region. The most advanced target is dubbed Virgin. Surface mapping and drilling has traced the zone for more than 500 metres along strike. Previous drilling returned several high-grade intercepts, including, 67.1 metres grading 7.9 grams in hole 11, 6.1 metres grading 46.4 grams gold in hole 43, and 27.5 metres grading 8.6 grams gold in hole 1.
The junior teamed up with Great American Minerals Exploration to jointly acquire the ground. In order to exercise the option, the partners must spend US$400,000 on exploration by the end of 2003 and US$250,00 every year thereafter, until the option agreement is exercised. The partners also agreed to pay US$2,000 per month until Dec. 1, 2002, and US$3,000 per month until the option is exercised. A US$25,000 payment is due on completion of the deal and a final US$2 million is payable by the end of 2007. Once the option to purchase takes effect, the property is subject to US$60,000 per year advanced royalty payments, a 5% gross royalty on gold production and a 4% net smelter royalty on any other mineral production.
Under an agreement with Great American Minerals, Madison can earn a 51% stake by taking care of the US$111,000 in property payments due through the end of 2004, spending US$650,000 and paying US$25,000 on closing. The junior can add a 9% interest by paying US$72,000 in property holding costs through the end of 2006, spending an additional US$500,000 by Dec. 1, 2006, plus US$250,000 every year thereafter. Madison has the right to up its stake to 75% by completing a feasibility study and arranging project financing.
In Papua New Guinea, Madison is running a regional prospecting and geochemical sampling program aimed at identifying new gold-bearing structures. The junior hopes to have a series of prospects ready for drill testing later in the year.
In 2000, Madison drilled four holes testing the western limits of the Roscoelite zone, the down-dip extension of mineralization in the C9 zone and a geochemical anomaly at the South Pump Creek prospect. The first two targets returned wide intervals ranging from 0.5-to-0.8 grams gold, whereas the geochemical anomaly failed to yield any significant mineralization.
Mt. Kare hosts an indicated and inferred resource of 25.53 million tonnes grading 2.2 grams gold and 29 grams silver per tonne.
Madison has a 90% interest in the property with Kare-Puga Development, made up of Mt. Kare landowners, holding the remaining 10%.
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