BacTech buys interest in PNG deposits

BacTech Mining (BM-V) is in the process of buying a 33% interest in two gold deposits in Papua New Guinea from Yamana Gold (YRI-T, AUY-N, YAU-L).

BacTech has received conditional approval from the TSX Venture Exchange for the proposed acquisition. The remainder of the project is held by Gold Aura (GOA-A), which is the current operator.

BacTech plans to pay for the interest by issuing 15 million shares to Yamana. After that Yamana will hold 20% of BacTech.

The deposits, known as Wapula and Gameta, are located on the north shore of Fergusson Island.

Yamana has had an interest in the properties since the early 1990s but is looking to divest so it can focus on its assets in North and South America.

Now BacTech must prove that it has the capital to carry out a work program on the projects this year. Once the work plan is completed, BacTech will be able to increase its interest to 38%.

The company has already completed a technical report, which was suggested by the TSX Venture Exchange. The report highlighted the need for extra drilling to confirm the historical results generated by Yamana and Gold Aura.

Before BacTech drills, the company will likely focus on the bioleach amenability work to see if the value of the assets can be improved by first dealing with any metallurgy issues.

BacTech, which focuses on buying equity positions in projects amenable to bioleaching, owns patented bacterial oxidation technology for the treatment of refractory ores and concentrates which enhance the recovery of gold, silver and base metals.

BacTech share were down half a cent today at 3¢ apiece on a trading volume of 100,000 shares.