Partners rework deal

Partners Etruscan Resources (EET-T) and Semafo (SMF-T) have amended the terms of their November 1999 acquisition of the Saoura gold permit in Niger.

The vendors, Ashanti Goldfields (ASL-N) and Iamgold (IMG-T), were originally paid a total of US$3 million and issued convertible debentures worth US$3.5 million.

Under the revised deal, the debentures are to be replaced with a US$2.25-million cash payment due Jan. 14, 2000.

In October 1999, Semafo acquired a 50% ownership interest in Etruscan’s wholly owned subsidiary — African GeoMin — by agreeing to pay for the acquisition of the Saoura permit and fund the balance required to bring African GeoMin’s nearby Samira Hill gold project to production.

Semafo will also be funding African GeoMin’s working capital requirements, which include exploration of the Saoura and Tiawa permits.

The partners’ top priority at Saoura is the Libiri gold deposit, where Ashanti and Iamgold reported a resource of 9.4 million tonnes grading 1.6 grams gold per tonne (480,000 contained ounces), based on a cutoff grade of 0.5 gram gold.

Etruscan believes the Libiri deposit and the Samira Hill deposit, situated 3 km apart, occur on a single stratigraphic horizon that has been traced for more than 30 km across its Tiawa permit and west into Burkina Faso on to its Datambi permit. As well, the company believes the horizon may continue eastwards another 10-20 km across the entire Saoura permit.

Now under construction, the US$23-million Samira Hill mine is scheduled to start up later this year. At full steam, the open-pit operation is expected to yield 67,000 oz. gold annually at a cash operating cost of US$168 per oz. over a minimum mine life of six years. The mine is 90%-owned by the African GeoMin partnership and 10%-owned by the government of Niger.