Junior companies are credited with many important mineral discoveries, but, in most cases, the companies and their projects are gobbled up by senior companies with the resources to build and operate mines.
David Walsh, president of Bre-X Minerals (ASE), is determined that this won’t happen to his company, or to its Busang gold discoveries in East Kalimantan, Indonesia.
“We are confident we have a resource of 30 million oz. gold, and we would not disagree with the estimate made by an Indonesian mining director who publicly described the resource as being 40 million oz.,” Walsh tells The Northern Miner.
He also expects that this year’s drill program, to continue through late summer, will increase the size and significance of its major asset, making Busang even more attractive to majors.
“Once that program is complete, we will consider inviting a senior partner to participate in and operate the project, but we intend to retain a 75% interest. And we would expect a bonus on any additional gold we find [after a deal is signed].”
Walsh does not consider these requirements to be a stumbling block for an eventual sale, even though majors usually like to have a majority interest in mines they operate.
“I think any senior company would be quite happy to have 25% of Busang, and keep the 12.5 million oz.”
Busang is at the prefeasibility study stage, with a report by Kilborn Engineering expected in weeks. Walsh envisions that Busang will eventually become a 70,000-tonne-per-day, open-pit