MSV gets $1.7m grant to fund Eastmain road

The remote Eastmain gold deposit in northern Quebec has moved one step closer to production following an announcement that the provincial government will provide financial assistance for a winter access road into the site. The government of Quebec recently offered to contribute $1.7 million in the form of a grant to pay for half the costs of building a winter road into MSV Resources’ (ME) Eastmain gold project. The 651- claim property, owned 100% by MSV, is in the eastern part of James Bay lowlands.

President Mario Caron said the grant is still subject to final government approval and the signing of a formal agreement between the company and the Quebec government.

The 160-mile road would extend from Temiscamie to the Eastmain project site along the Eastmain River, about 193 miles northeast of Chibougamau, Que.

Construction of the winter road was originally recommended by a preliminary feasibility study on the project which was completed back in 1989. The road would also be used to haul ore to an existing mill in Chibougamau for processing.

Based on previous exploration, the deposit is estimated to contain total reserves of 952,374 tons grading 0.35 oz. gold per ton of which 143,709 tons grading 0.39 oz. are in the proven category. Some 808,665 tons of material grading 0.34 oz. are classified in the probable category.

If the production decision is positive, the deposit would be mined as an underground operation at a rate of 400 tons per day with the ore transported to Chibougamau for final processing. About 100 jobs would be created by the project which has an estimated capital cost of $19 million.

MSV’s principal shareholder is Northgate Exploration (TSE) with a 33% stake in the company. Northgate also holds a 34.7% interest in Campbell Resources (TSE), whose Joe Mann mine near Chibougamau produced 49,000 oz. of gold in the first nine months of 1990. Shares of MSV of which there are about 16 million outstanding have traded recently at 32 cents per share within a 52-week range of 20-50 cents.