FLIN FLON, MB, Sept. 22 /CNW/ - St. Eugene Mining (TSXv - SEM) President
Rolly Trenaman today announced that the company has entered into an agreement
to acquire the assets of the Tartan Lake Gold Mining Property from Claude
Resources Inc. (TSX -CRJ)
The Tartan Lake Property, located forty kilometres from Flin Flon,
Manitoba, was previously in operation between 1987 and 1989. Developed by ramp
access to the 1,000-foot level and with mineralization developed on five
levels, the property contains a 400-tonne-per-day concentrator and related
facilities. The Tartan Lake Property acquisition offers St. Eugene an
extensive land package within a proven mineral belt. The property hosts a
historic mineral resource along with several known exploration targets. The
project is close to a smelter and existing infrastructure on the property
reduces exposure to escalating capital costs.
"After a thorough technical review, our mining team concluded that by
improving mining and milling practices, the Tartan Lake Property can be a
successful gold mining venture," said St. Eugene President Rolly Trenaman.
"The existing infrastructure, underground mine development, and knowledge base
acquired through the previous operation period, and extensive exploration
targets, combine to provide an opportunity for St. Eugene to put the property
into production at relatively low capital costs and enable our Company to
quickly capitalize on improved gold prices."
The technical review undertaken by St. Eugene identified a number of
attributes of the property that prompted the Company to proceed with its
acquisition. These include:
- Drilling to the 1,800-foot level has confirmed the continuity of the
main gold-bearing zone to that level.
- The property covers a further five kilometres of strike length to the
east, the shear zone which hosts the Main and other gold-bearing zones
that have hosted mine production to date.
- Close proximity to mining services in Flin Flon and access to Manitoba
Hydro electrical service creates operating efficiencies.
- Exploration in the area near the mine has defined a number of gold
zones which could provide additional resources.
- The arrangement with Claude includes a 35% interest in the Amisk Lake
gold property, which has reported non 43-101 compliant historic
resource of approximately 200,000 tonnes with a grade of
12 grams/tonne (0.35oz./tonne) gold. Until drilling and other detailed
exploration is conducted over the prospect, the above mentioned
"resource" estimate is highly speculative and should only be
considered as indicative of mineralization potential.
"St. Eugene Mining intends to build a gold mining entity based in the
mining friendly jurisdiction of Manitoba starting with the Tartan Lake
property. Flin Flon would act as a hub for the development of a number of
promising properties and prospects within reasonable administrative distance,"
said St. Eugene Mining president Rolly Trenaman. "St. Eugene is extremely
pleased to be associated with Claude in this transaction."
St. Eugene will pay a fee of $100,000 to Claude (the "Fee"), payable in
cash or by the issuance of 700,000 common shares of St. Eugene in
consideration for a 60-day exclusive due diligence period.
The purchase price for the Tartan Lake Property is $3,000,000 payable
over two years, plus a sliding-scale royalty on minerals recovered from the
Tartan Lake Property based on the price of gold, ranging from 0% if the price
of gold is below US$600/oz, to 6% if the price of gold is greater that
US$1,100/oz. St. Eugene has the option to buy down the royalty to 1% at any
time. The purchase price may be paid in cash or shares at the election of St.
Eugene. Up to 11,666,000 shares of St. Eugene, at deemed prices ranging from
$0.143 to $0.50, may be issued if St. Eugene elects to pay the Fee and the
purchase price entirely by the issuance of shares. In the event that any
issuance of shares to Claude would result in Claude becoming a control person
of St. Eugene such issuance will be subject to shareholder approval.
The purchase price for the Amisk Lake Property is a 1% net smelter return
Closing of the acquisition of the Tartan Lake and Amisk Lake Properties
is subject to a satisfactory due diligence review by St. Eugene, and
acceptance for filing by the TSX Venture Exchange.
The Tartan Lake and Amisk Lake Properties would be promising additions to
the Company's Moyie Lake silver/lead/zinc project in southeastern British
Columbia, where positive results have been achieved in recent exploration
R. T. Trenaman, P.Eng. is the qualified person for the Company in regards
to any technical data presented in this news release.
"R. T. Trenaman"
President and CEO
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.
This press release contains forward-looking statements within the meaning
of Canadian securities laws. Such statements include, without limitation,
statements regarding the closing of the acquisition of the Tartan Lake and
Amisk Lake Properties, timing of future activities by the Company, future
anticipated exploration and development programs, the review of technical
information, the discovery and delineation of mineral deposit and resources,
business plans, potential mining scenarios, business trends and future
operating factors. Although the Company believes that such statements are
reasonable, it can give no assurance that such expectations will prove to be
correct. Forward-looking statements are typically identified by words such as:
believe, expect, anticipate, intend, estimate, postulate and similar
expressions, or are those, which, by their nature, refer to future events. All
statements that are not statements of historical fact are forward-looking
statements. The Company cautions investors that any forward-looking statements
by the Company are not guarantees of future results or performance, and that
actual results may differ materially from those in forward looking statements
as a result of various factors, including, but not limited to, variations in
the nature, quality and quantity of any mineral deposits that may be located,
the Company's ability to obtain any necessary permits, consents or
authorizations required for its activities, the Company's ability to produce
minerals from its properties successfully or profitably, to continue its
projected growth, to raise the necessary capital or to be fully able to
implement its business strategies. In addition, forward-looking statements are
subject to various risks, including that data is incomplete and considerable
additional work will be required to complete further evaluation; no firm
quotes for costs have been received; the potential capital cost of the project
is beyond the current means of the Company; there can be no assurance that
financing for purchase or exploration will be available; and other risks
associated with the exploration and development of mineral properties. There
is no certainty that any forward looking statement will come to pass and
investors should not place undue reliance upon forward-looking statements.
For further information:
For further information: Rolly Trenaman: firstname.lastname@example.org