Vancouver — Subscribing to a lion’s share of Freegold Ventures’ (ITF-T, FGOVF-O) recent $6.2-million private-placement financing, US Gold (UXG-T, UXG-X) chairman and CEO Robert McEwen will end up with an 8.2% stake in the gold junior.
Freegold is selling 5.4 million units at $1.15 apiece with each unit composed of one share and half a warrant. Each full warrant will be exercisable at $1.60 for two years.
Aside from McEwen’s purchase of 4.5 million units, Sprott Asset Management will be acquiring 900,000 units to boost its interest in Freegold to 10.5% from 9.9%.
Funds will be earmarked to ongoing programs at Freegold’s Almaden deposit in Idaho and its Golden Summit project in Alaska.
Recent resource expansion drilling at Almaden has extended mineralization to depth and expanded a hydrothermal breccia zone associated with a newly discovered feeder structure.
An early 2006 resource estimate for Almaden calculated 22.5 million indicated tonnes grading 0.72 gram gold per tonne (about 516,000 contained ounces) plus additional inferred resources of 18.1 million tonnes of 0.62 gram gold (360,000 contained ounces).
Infill and expansion drilling of the North zone has been completed and assays are pending. Once the final holes on the Main zone are completed, the new resource study will incorporate the results.
Additionally, Freegold’s recent drilling at its Golden Summit project, near Fairbanks, Alaska, has cut a number of high-grade gold mineralized vein systems identifying potential bulk-tonnage shear-zone structures. It collected a 10,000-ton bulk sample of high-grade mineralized material in late 2006 and is awaiting permitting for on-site processing of the material, expected towards the end of the summer.
Following the news of McEwen’s stock acquisition, shares of Freegold rallied to a new high around $1.60 on high volume.
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