Vancouver-based Dayton Developments (VSE) and its private subsidiary Kimex Resources have acquired an option to buy Chevron’s (NYSE) 4% net returns royalty in the Andacollo gold project in Chile. Dayton gained control of the Andacollo project last year from Chevron which retained the royalty interest now being sold.
The two junior companies have agreed to transfer 500,000 shares of Dayton to Chevron in return for an exclusive option to acquire the remaining royalty interest in the gold property. If the option is exercised by next Jan. 15, Dayton will pay Chevron a total of US$2.2 million by March 30, 1991. The senior oil company already owns or has the right to acquire a total of 1.6 million Dayton shares.
A preliminary gold reserve estimate for Andacollo, calculated by the engineering firm of Fluor Daniel Chile S.A., is reported by Dayton as follows: Reserve Gold Category Tons (oz./ton) Proven & Probable 31,690,000 0.036 Possible 11,190,000 0.035 Total 42,880,000 0.035
The reserves were calculated for three separate gold zones — the Tres Perlas, Churrumata and Soccoro deposits — based on 70,280 ft. of drilling in 238 holes. Reserve estimates for another three deposits, tested by 73 drill holes, have not been included in the above estimates.
Earlier work by Chevron, including 92,000 ft. of drilling, outlined proven, probable and possible reserves of 11 million tons at an average grade of 0.05 oz. gold per ton.
Drilling and feasibility studies are continuing on the property, and the company says a production decision will be made upon completion of the current program.
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