At least US$100,000 will be spent this year by Pegasus Gold (TSE) to explore the Libby gold property under the terms of a recent joint venture agreement with Orvana Resources (TSE).
The Montana property is reported to host preliminary geological reserves of 14 million tons grading 0.02 oz. gold per ton, with “exceptional” metallurgical characteristics. The deposit is oxidized, and still open along strike in both directions and to depth.
Pegasus may acquire 70% of Orvana’s interest in the property by spending US$750,000 before September, 1995. Orvana may then elect to retain its 30% participating interest, or sell this interest to Pegasus for US$1.5 million. Orvana President Neil Hillhouse said he is “pleased” to have Pegasus as the operating partner.
“Pegasus has a tremendous track record of developing and operating low-grade heap leachable gold deposits,” Hillhouse said, adding the company is currently the largest gold producer in Montana.
Pegasus operates five mines in the United States and produced 315,300 oz. gold during 1991. The company expects to produce 360,000 oz. this year. With the exception of the Montana Tunnels mine, which has a conventional milling circuit, all the mines are open pit, heap leaching operations. The Libby gold property lies four miles from the town of Libby in northern Montana, and is considered to be ideally suited to heap leach processing. Previous bulk metallurgical sampling and large diameter column tests gave results of 92.3% recovery on run-of-mine material with short leach times. The deposit will not require crushing or agglomeration because of the high density of fracturing and low clay content.
Orvana was a private company for the past five years. During this period, the company’s team of experienced explorationists raised more than $11 million and assembled a portfolio of 21 exploration projects, some at an advanced stage.
Be the first to comment on "Pegasus acquiring Libby project"