A wholly owned subsidiary of William Resources (TSE), Bharti-Lammanen, has signed a share purchase agreement allowing the company to buy a 40% interest in BLM Minera Mexican from Minorca Resources (VSE).
BLM’s sole asset is the Velardena mining project in Durango state, Mexico. William recently completed a feasibility study which outlined possible and probable reserves of 2.8 million tonnes averaging 3.6 grams gold and 313 grams silver per tonne as well as 4.4% combined lead, zinc and copper. It is estimated the project will be capable of producing 67,000 oz. gold-equivalent per year.
William’s subsidiary paid $3 million and granted a 1% net smelter return royalty for an 11-year period on 40% of the commercial production to Minorco. The value of the transaction, including the royalty payment, represents less than 25% of William’s capitalization. Once it is completed, William will hold an 80% interest in the issued and outstanding shares of BLM. William also holds an option to buy the remaining 20%.
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