Bresea enters joint ventures

The pace of land acquisition in Indonesia appears to be picking up, as more and more Canadian companies strike deals in this latest hot spot of exploration.

One company, Bresea Resources (ME), recently entered joint-venture deals two other Montreal-listed juniors, Tandem Resources and Diadem Resources, covering four prospective properties spanning 40,000 hectares.

The properties lie within the Kalimantan magmatic arc, a geological belt that hosts the Mt. Muro and Kelian gold mines, as well as the Busang gold discovery and the Mirah gold deposit. The area was selected for its favorable geological environment and because it hosts known gold mineralization, as indicated by local artisanal activity.

Exploration of the four properties will be managed by Bresea’s 24%-owned affiliate, Bre-X Minerals (ASE).

Three of the properties, Mirah North East, Upper Mahakam A and Upper Mahakam B, are gold targets on the island of Kalimantan; the fourth, Belitung, is a base metal and tin property on Bilitung island, off the eastern coast of Sumatra.

Situated 30 km northeast of the Mirah gold deposit, the Mirah North East project is geologically similar to other deposits found along the mineralized volcanic belt. The property is underlain by a sequence of altered, andesitic volcanics and pyroclastics cut by mineralized fractures that trend north-northwesterly. Artisanal miners are working at several locations, and many shallow shafts and surface pits are present.

Diadem and Tandem each hold a 30% interest in the project, with Bresea claiming 25%.

The Upper Mahakam A and B projects are spaced 20 km apart in a northeast-southwesterly direction, and both are underlain by structures found in a prominent cluster of porphyritic, andesite-to-diorite plugs that intrude metasediments.

Alluvial gold is commonly found in many of the region’s river systems, and the partners regard the area as being highly prospective for epithermal gold deposits.

Under the agreement, Bresea and Diadem will each hold a 30% interest in each project, while Tandem will own 25%. As consideration for managing the exploration program, Bre-X is charging the venture a 15% management fee based on exploration funds spent. As well, Tandem will pay Bresea a particpation fee of US$100,000.

In the early part of this century, the Belitung project entered production as a tin mine. The metal was produced intermittently from 1906 until 1993, when low prices resulted in the mine’s closure. By that time, however, exploration work had identified a 6-km-long, sediment-hosted, zinc-lead-silver zone, ranging up to 20 metres in width. Estimates had suggested the structure could host up to 35 million tonnes averaging 7.3% zinc and 2.9% lead.

In addition to the Main zone, several other targets were found, following completion of an airborne magnetic survey and the discovery of mineralized float.

Bresea will own a 60% interest in the project; Diadem, 30%. In addition, Bre-X will charge a 10% management fee, based on the exploration expenditures, to supervise the program. Bresea has also agreed to finance the first US$100,000 worth of exploration work.