Wheaton River to sell stake in Yukon project

Wheaton River Minerals (TSE) is negotiating to sell a portion of its wholly owned Mount Skukum gold project as a way of raising the $4.5 million needed to bring the Yukon project into production.

As Wheaton’s 6.5 million issued shares are trading at around 30 cents, Secretary-Treasurer Kerry Knoll is ruling out equity financing because it would result in too much dilution of the company’s stock.

A prefeasibility study indicates that at a milling rate of 300 tons per day the property could produce 24,400 oz. gold and 583,600 oz. silver for at least five years at a cash cost of US$260 per oz.

Results of the study, announced at a meeting in Toronto, are based on estimated reserves in three zones of 522,627 tons grading 0.3 oz. gold and 7.9 oz. silver per ton.

Two of the zones are on Omni Resources’ (VSE) Skukum Creek property while the third is on ground previously held by Total Energold (TSE) and private Toronto company AGIP Resources.

Before Wheaton got control of Omni, the Vancouver company spent $13 million to develop the Skukum Creek deposit and it is believed the property would have been mined sooner if Omni and Total Energold had agreed on who should be operator. Wheaton paid Total Energold and AGIP $400,000 for the Mount Skukum mill.

Pending environmental permits, it should take about three months to install a flotation circuit in the mill, reinforce the tailings dam and bring the project into production, said Wheaton President Vic Jutonich. However, discussions with companies willing to finance the project are only at the preliminary stage, added Knoll.