Tillicum permits received

Permits are in hand for a bulk sample of the Heino-Money zone at the Tillicum Mountain property near Nakusp, B.C.

Bethlehem Resources (TSE) and Goldnev Resources (VSE) signed an agreement earlier this year to acquire the zone from Columbia Gold Mines (VSE). Minable reserves in the zone are estimated at 15,000 tons grading one ounce gold per ton. The Goldnev-Bethlehem joint venture plans to mine an initial 10,000 tons under the permits, in August and September, and Bethlehem President Brian Kynoch hopes to receive permits for the remaining 5,000 tons before the first phase is complete.

Ore will be trucked 112 miles to the joint-venture’s Goldstream mill, near Revelstoke, where the two companies operate an underground copper mine. The partners will pay Columbia $200,000 in stages plus a further $1.05 million in production payments of US$60 per oz. to a maximum of 14,000 oz. Columbia will receive an additional US40 cents for each US$1 per oz. that the joint venture realizes in excess of US$350 per oz. for gold production. It will also receive a 2% net smelter return on any production in excess of 14,000 oz.

Kynoch said the Goldstream joint venture should net a pre-tax profit of about $1.5 million on the 15,000 tons.

Bethlehem and Goldnev also have an option to earn a half interest in the remainder of the Tillicum Mountain property by spending $1.5 million by the end of 1997. Kynoch said Columbia is busy planning an exploration program, to start in September. It will include drilling on the East Ridge zone in an effort to expand reserves from the current drill-indicated 485,000 tons grading 0.30 oz. gold.