Wydmar raises cash for gold exploration

An option agreement between Southern Arizona Mining and Smelting (COATS) and Wydmar Development (VSE) will allow Wydmar to finance exploration on their Eskay Creek and Island Lake properties. Under the terms of the agreement, Southern will be issued a private placement of Wydmar shares in exchange for $800,000. Wydmar currently holds a 10% interest in two properties near British Columbia’s newest mining camp at Eskay Creek. The 12,350-acre Treaty Creek claims, nine miles east of the Calpine-Stikine deposit, are underlain by the same formation (Mount Dilworth) that hosts the major gold-silver discovery. According to Southern, several anomalous areas of gold and silver mineralization are apparent on the property.

A number of precious and base metal showings have also been identified on the Mt. Madge claims, seven miles south of the Calpine- Stikine gold-silver discovery. The Mount Dilworth formation also extends on to this 39,000-acre property.

In Manitoba, Wydmar will focus its efforts on the Island Lake property, where the company constructed a 25-ton-per-day test mill to process gold ore in 1988. At the time, geological reserves were estimated to be 445,000 tons grading 0.3 oz. per ton.

Wydmar holds a 60% interest in the Island Lake property, and has the option to earn an additional 20% in both the Mt. Madge and Treaty Creek properties. In all cases, Southern will be the project operator.