Vancouver – Northgate Minerals (NGX-T) is striking a deal to purchase the Sustut Copper deposit from Doublestar Resources (DSR-V).
Sustut is a high-grade copper deposit located in north-central British Columbia, about 40 km. south of Northgate’s Kemess South mine and milling complex.
Under the agreement, Northgate will acquire 100% of the deposit for five staged payments totaling $1.705 million.
Falconbridge (FL-T), who retain a 9% net profits interest royalty, discovered the deposit in 1971. Since then, almost 22,000 metres of drilling has been conducted as well as a recent National Instrument 43-101 compliant engineering resource study.
That 2002 study identified a measured resource of 4.9 million tonnes grading 1.7% copper in the Southeast and Southwest zones at Sustut, plus an additional indicated resource of 2.8 million tonnes of 1.61% copper, both using a 0.7% copper cut-off. A 2003 feasibility study outlined an open pit containing 4.7 million tonnes of ore grading 2.02% copper and 2.02 grams silver per tonne, representing 208 million pounds of in-situ copper.
Doublestar retains a sliding-scale royalty per ton of ore mined based on copper prices, up to $2.00 per tonne when the metal is over US$1.40 per pound.
Northgate is viewing Sustut as a source of high-grade copper ore feed to blend with the lower grade material from Kemess South and North, leveraging existing infrastructure.
The 300,000 oz. gold and 75 million pound copper per year Kemess South mine along with the adjacent 4.1 million oz. Kemess North gold deposit in north-central B.C. are Northgate’s principal assets.
Trading in Northgate remained flat on the news at just over $2.00 per share with volume of almost 426,000 shares. Meanwhile, at press time, Doublestar lost a couple of pennies to close at 20 on volume of 84,100 shares.