Under an option agreement, Pathfinder Resources (VSE) can earn a 53-80% interest in the Buckhorn gold property from Equinox Resources (TSE).
To do so, it must finance Equinox’s share of future expenditures on the Nevada property.
The now-closed heap-leach mine is owned 23.6% by Equinox and 75.4% by Cominco Resources (TSE). Equinox can increase its interest to 65% by spending US$2.5 million by the end of 1996.
On completion of the earn-in, Cominco Resources can either fund its 35% share of costs or dilute to a 5% net profits return.
Under the new agreement, Pathfinder must fund all of Equinox’s costs to the point of production.
At that time, Equinox would hold a 12-20% interest while Pathfinder’s interest would vary between 53% and 80%, depending on whether Cominco retained or diluted its interest.
The main target is a deep, high-grade zone below the mined-out pits. A resource of 1.1 million tons of sulphide material grading 0.11 oz. gold per ton has already been outlined below the pits, and the companies hope to expand this resource as well as locate high-grade zones at depth. Initial drilling is expected to begin shortly.
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