Vannessa bucks downward trend

Gripped by the summer doldrums, the Canadian Venture Exchange composite index dropped 31.58 points, or 1%, to finish the report period ended July 24 at 3,073.7. The mining index remained relatively unchanged for the week at 7,369.36, off just 4.55 points.

Halted in mid-July, Vannessa Ventures resumed trading 10 days later after releasing more details of the proposed acquisition of Placer Dome’s interest in the Las Cristinas gold-copper project in Venezuela. Placer has agreed to sell its interest for a nominal cash consideration and the assumption by Vannessa of all commercial obligations of Placer and its affiliates relating to the Las Cristinas project. Placer will receive a 2% net smelter return royalty on all future copper sales, and a sliding-scale royalty on gold sales ranging from 1% to 5% depending on the price of gold. Placer will hold a back-in right to re-purchase all assets whenever the project becomes economically viable to sustain production of 250,000 oz. per year, based on a 4-million-oz. reserve. If the back-in right is exercised, Placer will pay Vannessa 110% of all its capital and preproduction costs. Provided Vannessa has spent at least US$2 million, or maintained the property for more than one year, Vannessa will retain a 2% royalty of gold sales and a 2% NSR on copper sales. Vannessa proposes developing a 100,000-oz.-per-year operation, with estimated capital costs of US$35-50 million and operating costs of US$150 per oz. Vannessa closed up a dime at 95.

Philex Gold closed down 32 at $1.08 on the release of last week’s drill results from its joint-ventured Boyongan porphyry copper-gold prospect in the Philippines.

Grayd Resources was unchanged at 19. The junior is carrying out a US$350,000 exploration program on its White Gold property in Alaska, under option to Placer Dome. Samples from hand trenches in 2000 yielded 3.9 grams across 16.4 metres of the Shalosky showing. This year’s program is being managed by Grayd and will include geochemical sampling, mapping prospecting, geophysics and hand trenching. Placer can earn a 51% stake by spending US$3.1 million.

Aurora Platinum was off 26 at $3.09. The company is aggressively exploring for nickel-copper-platinum group metals in Ontario and Quebec, and recently discovered a kimberlite at the Belleterre property in Quebec.

Canabrava Diamond and Paramount Ventures and Finance have amended a joint-venture agreement with Kennecott Canada Exploration regarding the Rocky Island Lake and Pivot Lake diamond claims in Ontario. Canabrava will assume the role of operator in the revised area of interest, affecting some 11,500 sq. km of claims. Kennecott will provide a further $350,000 in funding this year, on top of the $800,000 already spent, and retain a 1.5% gross overriding royalty. Canabrava and Paramount plan to spend an additional $500,000 on the project by year-end. Canabrava closed up 3 at 20, while Paramount added a penny at 13.

Excellon Resources was up 3 at 25 after amending a 1998 agreement with Apex Silver Mines. Excellon can now earn a 51% interest in the Platosa and Saltilleros properties in Mexico’s Durango state by spending US$1.5 million on exploration over two years. The junior is undertaking a $1-million convertible note financing.

Sister companies Molycor Gold and Verdstone Gold are drill-testing the Pongo massive sulphide prospect, 75 km northeast of Kamloops, B.C. Assays from the first two holes are pending. Molycor closed up 5 at 16 and Verdstone tacked on 2 to finish at 10.

Leader Mining International jumped 19 to end at 59. In May, the junior picked up the right to a 100% interest in the Cogburn nickel project, near Hope, B.C, subject to due diligence. The company is evaluating the project for its platinum-group-metal potential.