Under the terms of the deal, Cameco and Shore submitted a bid for 100% of the project as did the group of Golden Rule, Mahogany and Goldsil. The Cameco bid of $23.1 million beat out the Golden Rule bid of $22 million. “This agreement is an amicable settlement,” Glen Harper, president of Golden Rule, said.
On conclusion of the purchase, Cameco’s interest in both properties will increase to 80% with the remaining 20% held by Shore. Cameco’s net cost will be $9.3 million whereas Shore’s outlay is $1.3 million.
The deal will allow Cameco and Shore to proceed with a production plan to bring both properties on stream by April, 1990. Using Cameco’s Star Lake mill just two kilometres to the north, the partners plan to produce 100,000 oz of gold during the project’s 2-year mine life. An exploration program will try to add to reserves.
Discovered in 1987 by Saskatchewan Mining Development (a predecessor company of Cameco), the mineralized structure crosses the common boundary between two properties which were under separate ownership agreements. Transom Lake was previously owned by Golden Rule (30%), Goldsil (51%) and Cameco (19%). Partners at Fork Lakes were Cameco (36%), Golden Rule (30%) Mahogany (19%) and Shore Gold Fund (15%).
The bidding arrangement provided a resolution to the dispute between both parties which stalled development of the project earlier this year.
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