Hope Bay raises funds

Hope Bay Gold (HGC-T) has raised $5 million in a private placement with Dundee Precious Metals (DPM-T).

Dundee, a closed-end investment company focused on precious metals, purchased 10 million units at 50 each. A unit consists of one share and a non-transferrable share purchase warrant that can be exercised at 65 until March 31, 2001.

Also, Hope Bay expects shortly to issue 12 million shares and 11.25 million warrants to Dundee in lieu of a $6-million loan. The warrants are exercisable at 65 until March 31, 2002.

Proceeds from the private placement are earmarked for the Hope Bay gold project in Nunavut, where the company and its partner, Miramar Mining (MAE-T), expect to begin a 23,000-metre drill program. The campaign is primarily aimed at extending the Boston, Doris North and Madrid deposits but includes 6,000 metres of reverse-circulation holes for several new targets.

At Boston, the largest of the three deposits, measured and indicated resources stand at 1.3 million tonnes grading 15.2 grams gold per tonne. Another 2.6 million tonnes grading 10.9 grams are classified as inferred. The upcoming program will focus on the B2 and B3 zones.

At Doris North, measured and indicated resources are pegged at 710,000 tonnes averaging 21.2 grams gold, whereas 957,000 tonnes grading 16.9 grams are classified as inferred. Drilling will test possible extensions of the Hinge zone to the north, as well as depth extensions to the Central and Connector zones.

Situated 8 km south of Doris, the Madrid deposit is the smallest of the three. However, hole M92, which cut 51.8 metres of 6.9 grams about 250 metres to the west, suggests the deposit may be larger; accordingly, several holes will attempt to verify this.

At last report, Madrid hosted measured and indicated resources of 328,000 tonnes grading 7.3 grams. Another 744,000 tonnes averaging 9.3 grams are classified as inferred.