Having disposed of its 19% stake in
The debt represents the final payment under Olympus’ US$7.5-million, cash-and-share acquisition of Ivanhoe’s Vietnamese mineral properties in 1997.
Ivanhoe sold its 19.1 million Olympus shares to Vietnamese-based investment fund Vietnam Growth Fund (VGF) for $5.7 million, or 30 per share. VGF is managed by Ho Chi Minh City-based Dragon Capital, a major shareholder in Olympus Pacific. The deal boosted Dragon’s stake in the junior to 37%.
In mid-January, Dragon spent $508,000 to exercise 1.27 million Olympus warrants. Dragon also manages the Vietnam Enterprise Investments Fund, which is an Olympus shareholder. Dragon currently holds a 41.07% stake in Olympus, on an undiluted basis; Zedex has a 17.51% interest.
In other news, the government of Vietnam has issued Olympus a licence to mine and develop its 85%-owned Phuoc Son gold project, 74 km from its existing 80%-owned Bong Mieu gold mine. The mining licence represents the final hurdle to development, with all environmental approvals already granted.
“We are obviously very excited to be given the go-ahead for our second mine,” says Olympus chief executive David Seton. “With the recent, successful commencement of production at our first mine at Bong Mieu, we can now focus on building our production profile with this high-grade, low-cost project and aggressively pursue our exciting exploration targets in the area.”
Phuoc Son is situated along the like-named suture, one of Asia’s main mineralized structures. A preliminary assessment of the Dak Sa underground project at Phuoc Son by engineering firm Micon International focused on the Bai Dat and Bai Go deposits. The study envisages an underground operation with a 6.5-year mine life producing 198,000 oz. gold and 79,8000 oz. silver. The price tag rings in at an estimated US$7.5 million. The high-grade nature of the deposits is expected to deliver capital payback in just five months. Average life-of-mine operating costs are forecast at US$145 per oz.
Olympus will review Micon’s study in light of recent positive drilling, which yielded 8.85 grams over 8 metres, 39.28 grams over 3 metres, and 23.97 grams over 4.7 metres at Bai Dat. Exploration and stepout drilling at Bai Go confirmed that the deposit remains open to the north and south. Drilling about 25 metres south of the current resource cut 134.72 grams gold over 2.51 metres.
Bai Dat is home to updated measured and indicated resources totalling 203,000 tonnes grading 18.95 grams gold using a cutoff of 4.5 grams gold. Another 83,000 tonnes of inferred resources grade 18.12 grams gold.
Bai Go contains 153,000 tonnes of measured and indicated material running 14.62 grams, with an additional 73,000 tonnes of inferred resources grading 7.1 grams. The resource figure has not been updated to include the new drill results.
Construction and commissioning are slated to wrap up in the second quarter.
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