Golden Zone and City Resources negotiate Alaskan joint venture

Negotiating for joint development of its Golden Zone property in south central Alaska, Golden Zone Developments has signed a letter of intent with United Pacific Gold Ltd., a private company partly owned by Australian-based City Resources Ltd. and City Resources (Canada).

Under terms of the letter of intent, United Pacific Gold would, in addition to making option payments of $120,000(US), commit a maximum $2.5 million to bring the project through feasibility; and after this would spend a maximum additional sum of $3.5 million to earn a 50% interest in the venture. Upon expenditure of $6 million both parties would jointly fund the project.

The property has proven and probable reserves of 1,164,870 tons of ore (above a cutoff grade of 0.08 oz gold per ton), grading 0.179 oz gold, 0.675 oz silver and 0.207% copper. This amounts to 208,512 oz gold.

In a separate deal, Golden Zone has agreed that Lacana Mining may acquire its 50% interest in a 42-claim block in Estrades Twp., northwestern Quebec. Sparton Resources, owner of the other 50% is also party to the agreement. To obtain 100% Lacana must spend $250,000 on exploration prior to May 1, 1989. Of this amount, $75,000 must be spent before Sept 30, 1988. Golden Zone will retain a 15% net profits royalty.