Vancouver – Starcore International Ventures (SAM-V, SHVLF-O) has struck a deal to buy the San Martin gold mine, in Queretaro, Mexico, from Goldcorp’s (G-T, GG-N) subsidiary Luismin.
The agreement will have Starcore paying US$24 million in cash and US$2 million in common shares for the mine, equipment and all other infrastructure used in its operation. Luismin will also hold rights to two seats on Starcore’s board.
The mine, located 50 km east of the city of Queretaro, is comprised of two underground operations (San Jose and San Martin) operated by Luismin since 1993. The deposit hosts proven and probable reserves of 900,000 tonnes grading 4.1 grams gold per tonne and 47 grams silver per tonne. The measured and indicated resource stands at 220,000 tonnes at 0.9 gram gold and 231 grams silver along with an additional 2.9 million tonnes averaging 2.8 grams gold and 111 grams silver.
Production stats for 2004 show almost 273,000 tonnes of ore grading 4.5 grams gold and 83 grams silver were processed, for output of 36,935 oz. of gold and 458,681 oz. of silver.
A condition of the agreement is that Starcore will assume Luismin’s (Goldcorp’s) obligations to sell the mine’s silver output to Silver Wheaton (SLW-T, SLW-X).
Starcore will be looking to raise a minimum of US$25 million in debt or equity financing to meet an additional condition of the purchase. With its 12.1 million shares outstanding, the company posts a $4.8 million market capitalization at its recent 40 trading level.
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