Agnico-Eagle flies south

A pair of recent deals will see Agnico-Eagle (AGE-T) leave its nest in Quebec for warmer climates to the south.

In Nevada, the company has inked a deal to earn up to a 75% stake in Miranda Gold‘s (MAD-V) Cono and BPV gold projects by paying a total of $355,000 over a five-year earn-in period.

To take an initial 60% stake, Agnico must spend $1.5 million on exploration over five years, with $50,000 committed during the first year. Agnico can then take another 10% by completing a bankable feasibility study and funding at least $200,000 worth of work per year. On completion of the study Agnico can boost its stake to 75% by arranging project financing, at Miranda’s discretion.

The 10-sq.-km properties (about 1.6 km apart) are situated in Nevada’s Cortez trend, about 5 km south of the Cortez joint venture’s ET Blue deposit. Placer Dome (PDG-T) is operator and 60% owner of the Cortez joint venture; Rio Tinto (RTP-N) holds the remainder.

Both properties lie within a west-northwest structural projection of fault-controlled mineralization. They are situated north of the mineralized Grouse Creek fault and adjacent to the south of the altered Dry Hills fault. Historic drilling at Cono indicates that lower-plate carbonate rocks exist in the basement below pediment gravels. The BPV property is underlain by upper-plate clastic rocks and chert. Limited surface sampling has outlined a stream sediment anomaly on the south end of The property.

Farther south, Agnico has entered into an option deal to acquire Industrias Penoles’ advanced Pinos Altos silver-gold project in northern Mexico’s Sierra Madre gold belt.

To do so, Agnico must first spend $2.8 million sinking around 16,800 metres worth of diamond drilling on the property over the next five months. Once the drilling wraps up Agnico will have two months to exercise its option to purchase the project for US$65 million, with US$39 million paid in cash and the balance comprising 1.8 million shares.

The 10-sq.-km Pinos Altos property is home to indicated mineral resources totalling around 4 million tonnes grading 6.2 grams gold and 131 oz. silver per tonne, for 800,000 contained ounces of gold and 16.9 million contained ounces of silver. Another 2.3 million tonnes running 6.2 grams gold and 117 grams silver are classified as inferred resources.

Agnico’s initial round of drilling will focus on converting resources to reserves, and open-pit and deep exploration.

More than 90% of Pinos Altos’ resource is found in the Santo Nino vein zone, which reaches thicknesses of up to 46 metres over a length of about 2 km, and a vertical extent of 550 metres. The zone is situated along a regional fault zone that hosts several other deposits in the area. It remains open to the west and at depth.

Penoles has initiated metallurgical test work and permitting.

The property is directly accessible by paved highway, and less than 100 km from a major electric power terminus. A proposed extension of the power grid runs about 10 km away.