Anglogold, Rubicon seal deal

The first foray into Canadian exploration by South African giant AngloGold (AU-N) is under way, following closure of the house’s deal with Rubicon Minerals (RMX-V).

The deal lets AngloGold earn a 60% interest in a land package of about 200 sq. km covering the north shore of Red Lake. Under the agreement, AngloGold will spend US$3 million on exploration over five years. Once the US$3 million is spent, Anglo can buy a further 10% for US$250,000 cash, and Rubicon can elect to have Anglo carry all expenses up to a bankable feasibility study. In that event, Rubicon can pay back its share of costs within 180 days, with interest of prime plus 3%.

AngloGold’s immediate commitment is for a US$300,000 program by late January, 2001, managed by Rubicon. Anglo can elect to manage the project after two years or after spending US$1 million.

The joint venture ground includes the Dorion-McCuaig corridor, a northwesterly striking deformation zone widely believed to be the northwestern extension of the Campbell-Dickenson “Mine Trend” structure.

Rubicon’s other two Red Lake properties are the McCuaig project on McKenzie Island, where it is earning a half-interest from Golden Tag Resources (GOG-V), and the Peterson project in Balmer Twp., where it is earning a 60% interest from privately held Peterson Red Lake Mines.

Rubicon started a small drill program on the Peterson project in late March, where drilling in the 1950s intersected narrow but high-grade gold mineralization. At McCuaig, surface work in late 1999 revealed two new showings: one, the extension of a quartz vein found by Freewest Resources Canada (FWR-M) in 1996; and the other, a zone of gold-arsenopyrite mineralization along the contact between mafic volcanic rocks and an ultramafic body.