Following a due diligence visit to China, Minco Mining & Metals (VSE) has signed a joint-venture agreement with the Szechwan Bureau of Geology & Mineral Resources (SBGMR).
The agreement enables Minco to earn 51% in the Chapuzi gold deposit, within Szechwan province, by spending $5 million on exploration. Minco will also fund all the exploration expenses.
As a result, the company’s interest as operator could rise to 75% after a mine and plant are constructed. The agreement covers a 120-sq.-km area where SBGMR has calculated a resource of 2.7 million tonnes of metasomatized basalt grading 2.9 grams gold per tonne. The outcropping, gold-bearing zones are up to 40 metres thick and are believed to be amenable to open-pit mining. Previous metallurgical work by SBGMR suggests the gold can be extracted by heap leaching.
SBGMR also believes the property has the potential for hosting 3 million oz. gold. Minco also closed a non-brokered private placement of 500,000 shares of common stock at a price of $1 per share.
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