Pursuant to its Aug. 2 agreement with Gerle Gold (VSE), Placer Dome (TSE) has acquired 750,000 shares of the company at a price of 53 1/3 cents per share. Of the placement, 562,500 shares are designated flow through, and the balance common shares.
The purchase brings Placer’s interest in Gerle up to 19.6% from 11.5%.
Placer has stated that the purchase is for investment purposes and that $100,000 of the funds will be used for working capital and the balance for the exploration program on Gerle’s McConnell Creek property, 150 miles north of Smithers, B.C.
Placer is earning a 30% interest in the property in return for spending $1.5 million on the property by Dec. 31, 1992 (not including the $300,000 from the placement). Placer can increase its interest to 60% by spending a further $2 million on the property by year-end, 1994.
Raymond Hrkac, president of Gerle, describes the property as being similar to the Con Mine owned by Nerco (NYSE) in the North West Territories.
Gold mineralization is hosted in a shear structure with what Hrkac called typical shear zone alteration patterns. Gold values are typically 0.20-0.30 oz. per ton over widths ranging up to 24 ft. and averaging about 6 ft. The structure has been traced on surface for a distance of over seven miles.
Hrkac said that the difference between the McConnell mineralization and the Con is that there is no arsenopyrite, but tourmaline and very little pyrite, suggesting that they are geologically high in the system.
If the geologic theory holds true, Hrkac said that he would expect to see arsenopyrite and, theoretically, elevated levels of gold at depth.
Placer’s upcoming program, which includes about 4,000 ft. of drilling plus an undisclosed amount of trenching, may shed some light on the Con theory.
Gerle has about 8.2 million shares outstanding and trades at the 25 cents level.
Be the first to comment on "Placer increasing position in Gerle"