South American Goldfields joint venture with Homestake

Another Canadian company, recently incorporated South American Goldfields Inc., which is closely associated with Golden Star Resources, is likewise turning to Guyana, South America, where a major gold hunt is getting under way.

Headed by geologist Alan Spence, it has acquired seven carefully selected 20-sq-mile mineral concessions, three of which have already been joint ventured to Vancouver-based Homestake International Minerals, the international exploration division of Homestake Mining Co.

The agreement provides for expenditures of $5.8 million(C) over the next three years. The initial phase of exploration calls for $850,000 to be spent on the three separate properties, 50% of which will be borne by South American Goldfields. Homestake, the operator, is committed to fund a greater proportion of exploration costs for a larger interest as the program advances.

Discussions and negotiations are under way with other potential joint venture partners regarding the company’s four other concessions, Tor Jensen, vice-president, tells The Northern Miner.

Incorporated as a private company that had raised $300,000, it subsequently amalgamated with Kapuskasing Resources, a dormant company which was quickly given South American free-trading status on the coats system. But it is already preparing an exchange offering prospectus which will raise additional funds and lead to a tse listing.

There has been a modest gold production from Guyana in the past, from both placer and underground workings. The country’s present government, it is gathered, is developing new mining and investment codes to encourage western capital. Placer Dome, Giant Resources and Golden Star are among the Canadian firms already active there.