Provided it succeeds in taking over Australian gold producer Valdora Minerals, William Resources (TSE) expects to be producing 200,000 oz. per year by 1999.
The acquisition is subject to the completion of due diligence, following which William will proceed with a $20-million private placement.
“We’ve done the bulk of the due diligence now,” says William President Stanley Bharti, “and we’re fairly confident that this deal is going to go through.”
Bharti is especially bullish on Valdora’s Rustler’s Roost heap-leach gold mine near Darwin, Australia. Rustler’s Roost will produce about 43,000 oz. this year at a cash cost of US$280 per oz. It has a large, sulphide resource, which could be expanded to 100,000 oz. per year, and total proven and probable reserves exceed 800,000 oz.
“We found that Valdora is producing at a reasonably attractive cost and has substantial potential to expand,” Bharti says.
Valdora also owns 80% of an open-pit resource at Ballarat East, which has yielded 18 million oz. gold, mostly from alluvial production.
Bharti says that if William absorbs Valdora’s production, it will become a diversified, broad-based mining company in the mid-tier range. “That has always been our goal.”
Bharti adds that his company will apply for a listing on the Australian Stock Exchange for the convenience of William’s Australian shareholders.
Meanwhile, William’s 50%-owned Brazilian subsidiary has uncovered significant gold mineralization in six of the first 10 diamond drill holes at its 1,600-hectare Sabara property near Belo Horizonte.
BW Mineracao, which is half-owned by Brazilian Resources (CDN), cut 1.92 grams gold per tonne over 68 metres, 2.86 grams over 9.3 metres and 1.85 grams over 27.6 metres.
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