A proposed deal would see
Under the deal, High River would transfer all its exploration properties in the country to Jilbey, excluding those already covered by a mining investment agreement with the government. Included are four new properties covering 900 sq. km, all of which are within trucking distance of High River’s planned mill at the Taparko project.
Two of the properties, Birgui-Nabingou and Bougou, host geochemical anomalies on favourable structural trends along the northwestern strike extension of the Taparko shear zone, which hosts the Taparko gold deposits. High River has already spent US$370,000 exploring the two, and Jilbey plans US$230,000 worth of rotary-air-blast drilling to test anomalies about 20 km from the proposed Taparko mill site later this month.
The agreement also calls for High River to help Jilbey acquire new properties, though it allows High River to acquire advanced gold projects on its own.
High River can back into a half-interest in any property hosting a new economic deposit within 100 km of the Taparko mill. Outside that radius, Jilbey can develop projects on its own; High River retains a 30-day right of first refusal on any properties on which Jilbey decides to form a partnership.
Pending the approval of regulators and the directors of each company, a standard joint venture will allow for development of any gold deposit discovered within trucking distance of Taparko. High River will act as the operator during development and production. The tolling charge to process ore from such a discovery will be based on any expansion expenses High River might incur at the Taparko mill, plus the cost of processing.
High River already has a 10% stake in Jilbey, and has further agreed to subscribe for 10-15% of its future equity financings. High River will contract its exploration team to Jilbey, at cost.
In Burkina Faso, High River and Jilbey control more than 5,300 sq. km, two-thirds of which is within trucking distance of the Taparko mill.
High River began developing the Taparko gold project in late October 2003. Plans call for the construction of a mill and infrastructure capable of processing ore from both Taparko and
The combined operation would run through a million tonnes of ore per year to produce around 680,000 oz. gold over a mine life of 7.5 years.
The latest deal spells out Jilbey’s rights of access to the mill.
High River owns 80% of Taparko; the Burkina government, 20% (5% of which is participating).
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