Gold City acquiring producer

Concurrent with a change in control, Gold City Resources (ASE) hopes to revive the old Camp McKinney property near Bridesville, B.C.

Control of Gold City recently changed to John Chapman, Mel Smale and William Kure with Paul White, former president, remaining as a director. The John Chapman group of companies (through Cazador Explorations) brought the Keystone gold mine into production last year by reviving the 1,500-tonne-per-day Lynn carbon-in-pulp mill at Lynn Lake, Man. The project, Western Canada’s only new gold mine, is a joint venture with Black Hawk Mining (TSE). A merger of Cazador and Granduc Mines, followed by a financing, resulted in control of Keystone being transferred to Conwest Exploration (TSE) and its associated company, Jascan Resources (TSE). Chapman, now president of Gold City, expects to complete some form of combination with McKinney Mines, the private company that owns the Camp McKinney properties. Chapman is also president of McKinney and notes that both companies now have essentially the same management and major shareholders.

The Camp McKinney claims are centred on the Cariboo-Amelia mine, a former underground producer. Mining dates from the late 1800s and early 1900s, with limited production having occurred as recently the 1960s.

Past production from the mine is reported at 87,200 oz. gold from 121,800 tons of ore for a recovered grade of about 0.72 oz. gold

per ton.

The mine’s Main vein has been traced 6,400 ft. along strike, while the old mine workings cover only about 2,500 ft. of strike down to a maximum depth of 580 ft. Further potential is seen on strike and to depth, particularly as the vein is of a mesothermal type, which often extends to depths comparable to the mineralized strike length.

Chapman also sees potential in identifying skarn zones on the property similar to that being developed at the Crown Jewel concession (owned by Battle Mountain Gold and Crown Resources) 12 miles southeast in Washington state.

Pending a financing, planned work this year is budgeted at $450,000 and includes mapping, geophysical work and 10,000 ft. of diamond drilling in two stages.

Meanwhile, Gold City is awaiting further assays from drilling on its Midway project, 7 miles to the southeast.

Recent drilling by Sway Resources (VSE) and Phoenix Resources, which jointly own a 51% interest in the property, returned an 11-ft. intersection grading 1.52 oz gold from a breccia zone of indeterminate size. The hole is 65 ft. south of the 1990 discovery (rotary) hole which encountered 20 ft. grading 0.25 oz. gold.

Chapman is excited about the property’s potential given its proximity to a large sulphide mineral system known as the “Old Nick.” This latter deposit forms part of the Midway project and is just over a mile north of the high-grade hole. Old Nick is estimated to contain 100 million tons grading 0.22% nickel plus undetermined copper and cobalt.

Following a debt settlement and a $200,000 private placement from McKinney Mines, Gold City has 8.6 million shares outstanding and a positive working capital position.