Redfern plans drill program at Tulsequah Chief property

A drilling program at the Tulsequah Chief property in northwestern British Columbia is expected to begin in the second week of August.

Redfern Resources (TSE) now holds a 100% interest in the property following its recent purchase of Cominco’s 60% interest.

The terms of the purchase include a cash payment of $100,000 plus 1.1 million treasury shares of Redfern.

Michael Kenyon, a director of Redfern, said Cominco agreed to reduce the cash payment to $100,000, from the original $200,000, after it was discovered that there is an overriding royalty of 10 cents per ton on the property. Under the terms of the purchase agreement, Redfern also established a trust of $1.15 million to cover the cost of rehabilitating what are described as minor site disturbances from past mining activities on the property. Redfern’s planned drilling program will test both the updip and downdip extents of the Tulsequah deposit. The latest preliminary estimates put reserves at about 8.6 million tons grading 1.6% copper, 1.2% lead, 6.5% zinc, 0.08 oz. gold and 3.2 oz. silver per ton.

Redfern’s initial budget for this year’s work is $1.5 million, although Kenyon said that may increase.

Kenyon said the company is in the process of completing a private placement of up to $2.78 million through the issuance of 577,000 flow-through units and 350,000 regular units at $3 each.

The units include a warrant giving the holder the right to purchase an additional share at $3.30 for one year.