By signing a letter of intent, Princess Resources (PRL-V) has enabled Dublin-based Arcon International Resources to gain a toehold entry into its exploration projects in China and Africa.
Arcon will subscribe for a convertible debenture in Princess worth a maximum of $4.5 million. The Irish firm has eight months in which to evaluate the development potential of the Princess properties, after which time it will decide whether to convert the debenture into an initial 41.4 million Princess shares or redeem the debenture.
Arcon is especially interested in properties situated in southern Hunan province, China. Among the most advanced of these is the Da Fang prospect, where Princess and its Chinese joint-venture partner are carrying out a 22,000-metre program of reverse-circulation drilling in an attempt to evaluate an inferred resource of 5.9 million contained ounces gold-equivalent. Copper, zinc and lead values are also present.
Arcon intends to use funds from the debenture to complete delineation drilling at Da Fang and bring the project to the feasibility stage.
The Canadian junior also has interests in prospecting licences in Tanzania and Zambia, where advanced-stage exploration projects are pursuing both gold and base metals targets. Current work is focused on the Makongolosi B property in the Lupa Goldfields region of Tanzania. Initial results are pending from a 5,000-metre program of reverse-circulation and diamond drilling at Makongolosi B.
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