An option agreement between Denver-based Orovi and International Tournigan (VSE) will accelerate work on the latter’s 80%-owned Morobe gold project in Papua New Guinea.
Orovi can earn half of Tournigan’s interest by completing a US$1.5-million feasibility study. The remaining 20% in the project is held as a net profits interest by the underlying landowners.
In 1993 and 1994, Robert Friedland put up $650,000 for work on the project under an option to acquire it. Tournigan reached an agreement with Friedland to regain control of the property in return for shares, with regulatory approval pending.
The project is in the Wau-Bulolo Valley, adjacent to an old dredging operation run by Placer Dome between 1932 to 1966. That operation recovered some 2.2 million oz. of gold using seven bucket-ladder dredges on the Bulolo River.
Tournigan believes the Morobe play has the potential to host a large, alluvial reserve.
Preliminary work to date returned grades of 1-1.5 grams gold per cubic metre in one area. Three other areas have yet to be tested.
Tournigan has been active in Papua New Guinea since 1985 and is the largest holder of exploration licences in the country. It is carrying out a private placement, as a result of which it will have 7.4 million shares outstanding and $750,000 in working capital.
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