A letter of intent between a Northfield Minerals (ASE) subsidiary and Hemlo Gold Mines (TSE) has paved the way for further exploration on the Swansea gold project about six miles west of Virginiatown, Ont.
The terms of the letter call for Hemlo to spend $900,000 exploring the claims over a 4-year period and make option payments totalling $200,000 in order to earn a 51% interest in the project. Towerlands Properties, a Northfield subsidiary, holds a 75% interest in Swansea.
The property consists of 10 claims along the Larder Lake break, less than two miles west of the Cheminis gold mine. Hemlo has also optioned the adjacent Omega property.
Surface drilling on Swansea in 1987 yielded two encouraging results: 0.13 oz. gold per ton over 6.5 ft. and 0.32 oz. gold over 20 ft.
The Cheminis mine went into operation in July, 1991, and is expected to produce 10,000-15,000 tons of ore per month.
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