BacTech Mining has signed a Letter of Intent (LOI) with Scorpio Gold Corp (SGC), which is 93.5% owned by Toronto listed Scorpio Mining Corp (SPM), to acquire its gold assets in Nova Scotia and Quebec, in exchange for common shares of BacTech. The transaction will result in SPM becoming the controlling shareholder of BacTech. The resulting company, to be called Scorpio Gold Corp, will continue to pursue BacTech’s strategy of acquiring refractory gold and complex base metal projects for application of its proprietary bioleaching technology. The company will also have a portfolio of advanced stage development properties in Canada, and access to SPM’s expertise in Mexico for acquiring, developing, or operating complementary projects in Mexico.
Commenting on the proposed transaction, Ross Orr, President and CEO of BacTech said, "After an extensive search for a new direction for BacTech, we are pleased to announce this new initiative for the company. We will still be able to pursue the four refractory projects we are currently working on, and, at the same time, develop near term production gold assets internally. Peter Hawley, Chairman and CEO of SPM, has over 20 years of experience in Mexico, and he will be instrumental in assisting us in identifying projects, both refractory and conventional, for the new company. In addition, SPM has built a solid infrastructure in Mexico which will provide us with access to resources that have only been available through consultants in the past."
Hawley commented: "Not only does this transaction add value to the Scorpio gold assets, it also allows us to open another avenue to develop the gold focus of SGC and to pursue cost effective, environmentally friendly avenues towards the exploitation of precious and base metals. We certainly look forward to developing the Company into a solid metal player within these exciting times."
The Scorpio Assets:
Caribou Gold Mine: Located 80 km north of Halifax. SGC has the right to earn a 100% interest in this past-producing high grade gold mine, with potential to expand and upgrade the current NI 43-101 Inferred mineral resources of 350,305 t grading 8.41 g/t Au, uncut (94,763 contained oz of gold). An aggressive exploration and development plan has begun that includes surface diamond drilling, dewatering of the old mine shaft, erection of a head frame, a hoist system, supporting surface
infrastructure, underground mapping and diamond drilling. Completion of this program will require additional financing and various alternatives are being considered to raise these funds. A bulk sample decision will be made based on the results of this program.
Cochrane Hill Deposit: 100% owned, located in Guysborough County, Nova Scotia. Recently, this advanced property was optioned to Atlantic Gold of Australia. The current NI 43-101 resource study estimates an Indicated mineral resource of 588,794 t grading 0.191 oz/t Au (112,460 contained oz of gold) and an Inferred mineral resource of 29,422 t grading 0.165 oz/t. Atlantic Gold will work to increase these resources through a planned $4.75 million exploration program and will make $100,000 in cash payments over a four year period to earn a 60% interest in the project. Atlantic Gold’s main focus will be to look at the economic viability of an open pit mining operation.
Lac Arseneault Property: Located in the Gaspé region of eastern Quebec, the property is a mid-stage exploration project in which SGC has an option to earn a 100% interest. High-grade gold-silver-zinc-lead mineralization is hosted in an extensive system of quartz veins and breccia zones. Previous work includes mapping, geophysics, trenching and diamond drilling.
SPM has had a presence in Mexico for over nine years and, as such, has evaluated numerous properties which do not fit the mandate of the company but could potentially fit SGC’s plans. Initial reconnaissance by SPM has identified five gold showings worthy of follow up by SGC.
