An option to purchase more than 4.6 million shares of RFC Resource Finance (TSE) from Kerr Addison Mines (TSE) at 44.3 cents per share will be exercised by Minnova (TSE). The shareholdings represent a 45.8% interest in RFC.
Minnova has finished an underground drill program at RFC’s 100% owned Pend Oreille mine in Washington state. Fourteen holes totalling 16,206 ft. were drilled on a tight 100-ft. grid to confirm a core of higher-grade mineralization in the Yellowhead zone previously outlined by RFC. Probable reserves are estimated to be 3.8 million tons grading 10.7% zinc and 1.8% lead.
Minnova carried out a study to develop a mining plan and cost estimate. An environmental audit was commissioned to document liabilities from the old mining activities, estimate the rehabilitation and mitigation requirements of these liabilities, and outline mine permitting requirements and issues. Permitting is expected to require about 12 months.
The next phase will be a final feasibility estimated to cost $6.6 million; it will take about 12 months to complete. Commercial production could be achieved by the fourth quarter of 1994.
Minnova contracted Dynatec Engineering to evaluate mine development and estimate costs. The company recommended two internally bored shafts to link the Yellowhead zone to the existing Josephine zone conveyor for ore and personnel hoisting. A room-and-pillar mining method is proposed.
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