Silver Standard picks up mine

Vancouver — Silver Standard Resources (SSO-V) plans to move ahead with the purchase of Kinross Gold‘s (K-T) past-producing Candelaria silver mine in western Nevada.

The junior will pay $100,000 and issue 600,000 units for the property. Each unit comprises one share and one warrant exercisable at $3.50 per share for a year. Silver Standard will also deliver a $300,000 note, which matures in 12 months and is payable in cash or stock. The deal is expected to close before the end of the month.

The agreement includes certain buildings and underlying royalties. Kinross is proceeding with reclamation work, which should be completed by the end of the third quarter. The two companies are currently engaged in transfering the various land titles and permits for the project, as well as arranging reclamation bonding.

Silver Standard entered into the option agreement in 1999.

The property hosts a resource of 4.6 million tons grading 6.1 oz. silver per ton at the Deep Diablo zone and 2 million tons averaging 8.39 oz. silver at the Northern Belle zone. The company retained Snowden Consultants to estimate a resource block that could be mined by low-cost, open-pit methods. This estimate puts the combined resource for both zones at 27.3 million tons grading 3.4 oz. silver at a cyanide-soluble cutoff grade of 0.5 oz. per ton.