A technical review of the Refugio gold project in Chile is in agreement with the conclusions of the previous feasibility study.
The review was carried out by Cypress Amax Minerals (NYSE), the parent of Amax Gold (NYSE). Amax and Bema Gold (TSE) are joint owners of the project. The owners plan to resume immediately negotiations with banks to arrange financing. They also plan to begin engineering work.
The capital cost of the open-pit project is estimated at US$130 million and the partners are negotiating a $100-million debt facility. The balance of the cost will be supplied as equity by the partners on an equal basis. To help cover its equity position, Bema has announced a brokered private placement of 5.1 million special warrants at $2.95 each. The special warrants include one common share and half a warrant good for an additional share at $3.40 for one year.
“Base case” minable reserves are estimated at 112 million tons grading 0.030 oz. gold per ton, with a stripping ratio of 1-to-1.
The feasibility study calls for a 33,000-ton-per-day, open-pit, heap-leach operation. Yearly production is projected to be 233,000 oz. at an average operating cost of US$175 per oz.
Bema has been trying to finance the project since April, 1991.
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