Varna will acquire all the outstanding shares of Gingrich by issuing 300,000 Varna shares and paying $25,000 and a 10% net profits interest to Gingrich’s shareholders.
The Tilt Cove property covers the eastern workings of the former producing Tilt Cove copper mine. In 1957, the mine began operations at a rate of 2,000 tons per day, producing more than 180 million lb of copper and 45,000 oz of gold during its 10-year operating life.
A gold discovery by Bitech Energy on that company’s Nugget Pond property just 8 km southwest of the Tilt Cove property has demonstrated that gold deposits can be hosted in the Betts Cove ophiolite. The Betts Cove ophiolite, a regional geological unit in the area, is better known for its copper potential.
Exploration work completed by Varna last year outlined a gold mineralized zone in a massive sulphide horizon. Located north of the Tilt Cove mine, the zone yielded gold values up to 0.13 oz per ton.
A field study completed by the Geological Survey of Canada on the Varna project in 1988 identified two new gold mineralized zones, hosting values ranging up to 0.3 oz gold per ton in grab samples.
Varna plans to conduct a till and soil sampling geochemical survey, geophysical surveys and complete a compilation of the old mine workings. The $250,000-exploration program is scheduled to begin in June.
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