Viceroy sinks debt, focuses on Africa

With a prepaid shipment of gold from the Castle Mountain mine in northern California, Viceroy Resources (TSE) has eliminated its gold loan 14 months ahead of schedule. The shipment amounted to about 9,600 oz.

The open-pit mine has produced 400,000 oz. since it opened in 1992, enabling Viceroy to pay back US$42 million in debt within three years. A US$6.8-million loan for the grinding mill was paid off in less than a year, while the remaining gold loan of about US$35 million was repaid to a consortium of banks led by NM Rothschild & Sons.

The company has a 75% interest in the mine, and has just completed a mine plan to develop the Oro Belle, Hart Tunnel and Jumbo deposits. This is expected to extend the life of the operation.

Meanwhile, Channel Resources (TSE), which is 30% owned by Viceroy, has resumed drilling at its Bouroum property in Burkina Faso, West Africa. Four of the first five holes hit significant mineralization, the best showing being hole 2 which had 18 metres grading 32.25 grams gold per tonne. Follow-up drilling is under way on the F-12 extension.

Geologic mapping, surface sampling and geophysical surveys have evaluated 69 prospects on the company’s four concessions, which comprise 6,200 sq. km. To date, 19 targets have been drilled, eight of which encountered sufficient mineralization to warrant a second phase. Most of the concession areas remain unexplored.

Channel is also exploring for gold in Argentina, where reconnaissance and field work has produced more than 1,700 stream sediment, soil and rock samples since January. The project covers 47,000 hectares in the Las Flechas area of San Juan province.