Two separate agreements have provided
The proposed heap-leach project is in Mexico’s Sinaloa state, and has proven and probable reserves of 6.1 million tonnes grading 1.86 grams gold per tonne, equal to 368,400 contained ounces gold.
The first agreement will generate US$6.1 million of financing to develop the mine. Midwest, a private corporation based in Delaware, agreed to provide the funds in return for a half-interest in the Magistral joint venture and a 15% equity interest in Pangea Resources, the subsidiary that owns Magistral.
In the second deal, Queenstake acquired a 6-month option to acquire the shares of Oro, a Mexican company owned by
The past-producing Santa Gertrudis has gold resources that require a higher gold price in order to be economic. Should this come about, Campbell will be entitled to one-third of any profits. Queenstake says mining equipment and buildings from Santa Gertrudis are appropriate for use at Magistral, with the exception of some crushing equipment. The costs of moving and re-erecting this equipment are considered as capital and operating costs within the Magistral joint venture.
An independent feasibility study has been completed for Magistral, with mine planning focused on four discrete pits. Production from known reserves will produce 268,500 oz. over seven years at a recovery rate of 72.9%. The stripping ratio is estimated at 5.6-to-1, whereas direct operating costs are expected to average US$180 per oz. over the life of the project.
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