Northwestern taking bigger handful of Picachos

Northwestern Mineral Ventures (NWT-V, NWTMF-O) will take a bigger piece of the pie from Yamana Gold (YRI-T, AUY-X, YAU-L) at the Picachos silver-gold project in Durango, Mexico.

Toronto-based Northwestern now has the right to acquire a 70% interest in the 77 sq. km property.

In Toronto on July 12, Northwestern shares were off roughly 5% or 3 to 55 on roughly 85,000 shares traded. Yamana shares stood unchanged at $11.30 on roughly 3 million shares traded.

“Our management team believes that Picachos is a highly prospectiveproperty based on strong exploration results to date, its strategic location and its favorable geology,” says Northwestern’s president and chief executive Marek Kreczmer in a statement.

“Northwestern expects work on the property, which will consist of ground geophysics and drilling of a near-surface disseminated zinc and silver mineralization, to restart following the rainy season in early September.”

Soil geochemical surveys and chip-channel sampling at Picachos, conducted as part of Northwestern’s 2005 exploration program, defined epithermal precious metal mineralization over four neighboring areas the company says.

Northwestern says there is the potential for a near-surface, open-pittable silver-rich area with the presence of lead and zinc mineralization.

Under the terms of the letter of intent, Northwestern will pay US$3 million in exploration expenditures over three years, pay US$400,000 in cash installments, including US$100,000 on the signing of a definitive option agreement, and issue 1 million shares over a three-year period to acquire a direct 70% ownership of Picachos.

Northwestern will act as operator of the project.

Yamana acquired its share in the property with its takeover of RNC Gold in November of 2005. The agreement signed between Northwestern and RNC will be terminated with the signing of the new deal.

Northwestern is also looking for uranium in Niger and Canada alongside its precious and base metal property in Mexico.