River strikes deal for Edwards

Strike Minerals (YKS-T) has agreed to acquire the mothballed Edwards mine in Algoma, Ont.

Strike paid $20,000 on signing the deal and must issue 500,000 shares to River Gold Mines (RIV-T) plus 500,000 share purchase warrants at closing. Each warrant allows River to buy one Strike share for 20 for one year following the closing. Strike must also pay another $30,000 in cash at closing.

The deal has yet to be approved by regulators.

The mine has been closed since July and won’t reopen until gold prices improve to significantly, at which time on-site exploration will resume.

The mine churned out more than 140,000 oz. gold over the past five years.

River Gold Mines enjoyed record gold production and a return to profitability during 2001, thanks in part to a switch to longhole mining and development of higher-grade ore at the Eagle River mine near Wawa, Ont.

River expects to produce 75,000 oz. gold at relatively low cash costs during 2002.

At the end of 2001, proven and probable reserves totalled 1 million tonnes grading 9.8 grams gold, off slightly from the previous year-end. The company’s cash and equivalent position amount to $7.5 million.