Miramar finances program

Miramar Mining (MAE-T) has engaged Canaccord Capital to arrange a $4-million private placement financing for expanded exploration of the Hope Bay joint-venture gold project for the remainder of this year and into early 2001. The project is in Nunavut.

The placement will consist of 3.3 million special warrants priced at a $1.20 each. One warrant will be exercisable for one flow-through share without any additional payment.

At the end of the first quarter, Miramar held $25 million in cash, with 57 million shares outstanding.

Miramar and its equal partner, Hope Bay Gold (HGC-T), are reviewing results from 39,000 metres of infill drilling completed in the first half of 2000 in the Boston and Doris areas of the project. The program was designed to increase the resource confidence to the measured and indicated categories. The previous owner, Australia’s Broken Hill Proprietary, estimated an inferred resource of 4.3 million oz. contained in 12.8 million tonnes grading 10.4 grams gold per tonne for the three principle mineralized systems, including Boston, Doris and Madrid. A new resource estimate is expected to be announced by September.

In the meantime, surface exploration is under way on the 1,000-sq.-km project, which covers nearly the entire Hope Bay greenstone belt. The work is expanding the search for extensions of the Boston and Doris deposits, while re-evaluating the lower-grade Madrid deposit.

In addition, the joint venture will evaluate 11 prospective targets and perform follow-up work on six of 14 high-priority targets during the remainder of the year — all in preparation for drilling. Previous work by BHP identified more than 50 prospective targets.

Pending the closure of a $5-million private placement financing with Dundee Precious Metals (DPM-T), Montreal-based Hope Bay Gold will have topped up its treasury to about $7 million. As part of an agreement to suspend merger negotiations, Dundee agreed to a private placement of 10 million units of Hope Bay at 50 each.

Dundee was also granted the option of converting an outstanding $6-million loan to Hope Bay into 12 million Hope Bay shares and 12 million share purchase warrants with an exercise price of 65 per share and an expiry date of July 31, 2003. This, in turn, will cancel an earlier right to convert the loan to a 3.5% net smelter return royalty on Hope Bay’s portion of the project. Once the deal has closed, pending satisfactory due diligence, Hope Bay will have 124 shares outstanding, or 148 million on a fully diluted basis.