Having completed mill tests on 6,000 tons of ore to confirm grade and recovery, Deak Resources (TSE) says it will exercise its option to acquire the Astoria deposit in northwestern Quebec from Yorbeau Resources (TSE).
Reserves at Astoria stand at 1.18 million tons grading 0.2 oz. gold per ton. Facilities include a production scale shaft, head frame and hoist.
Operating at an initial rate of 500 tons per day, Deak plans to produce approximately 36,000 oz. gold from Astoria in 1993. The company has applied for regulatory approval to process the ore at its Kerr mill, approximately 30 miles to the west at Virginiatown, Ont.
On closing the deal, Deak must issue Yorbeau a $200,000 promissory note payable over 50 months and a warrant to purchase 500,000 Deak shares at 60 cents per share. Yorbeau will retain a 40% net profits interest until it has received $3 million. Thereafter, the junior will receive a 2% NSR convertible to a 40% working interest.
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