Brohm to develop South Dakota bet

With a working capital of $4.3 million, Brohm Resources says it is in an excellent financial position to develop its Gilt Edge project in South Dakota. The company recently completed a private placement in Europe which raised approximately $2.7 million.

Wright Engineers of Vancouver is preparing a first-phase feasibility report which will include a mine plan, capital costs and operating costs. Operations are expected to begin this year and 1988 production is forecast at 50,000 oz gold. Last year Wright prepared a detailed estimate of reserves and came up w ith 36.4 million tons at 0.038 oz gold with a 1.75-1 strip ratio. About 20 million tons of that is oxide material and the grade is slightly lower. There are approximately 27.5 million tons at 0.044 oz gold and a 2.7-1 strip ratio at a higher cutoff grade. Just over half that tonnage is oxide material.

Reserves are expected to increase with more drilling and mine life should be five to seven years, the company notes. The property is located four miles from the famous Homestake mine in the Black Hills of South Dakota.