U.S. Report BMR focusing on California project

The focus for the coming year for BMR Gold (ASE) will be to bring the America Mine gold project to the point of a production decision. BMR has the right to acquire a 75% interest in the America Mine project, in San Bernardino Cty., Calif., from Fischer-Watt (SSE). By making property expenditures of $200,000 followed by a cash payment of $500,000 when the project is put into production, BMR will own the property with Fischer- Watt holding a 25% net proceeds royalty interest.

Since acquiring the property interest last October, the company has drilled a total of about 22,000 ft. primarily in two zones, the Central and the West. BMR estimates that the two zones contain a preliminary estimate of reserve of seven million tons grading 0.07 oz. gold per ton. President Frank Varseveld said he expected the stripping ratio to be in the order of 5-to-1 waste- to-ore.

A recent private placement of 716,600 units netted the company $897,000. Each unit includes a warrant to buy an additional share at $1.50 in the first year and $2 in the second year when the warrants expire. The company expects that, with the exercise of 393,000 warrants at $0.75 by July plus the exercise of the recent private placement warrants before year-end, the company will raise a total of $2.4 million.

The funds will be used for further drilling and prefeasibility work. BMR believes final feasibility and permitting for the project will be completed by year-end with production starting in 1991.

The project’s location in the San Bernardino Cty. could throw an environmental wrench into the works, however, with the potential of an unforeseen holdup in permitting. As an example, Viceroy Resources (TSE) has been trying to obtain an operating permit in the same county since 1987.