Acquisition would have increased SJ mine area 30 timesExcerpt from 2016 which includes the proposed acquisition of this massive sized property surrounding the SJ mine....what happened ?
On September 18, 2014, the Company announced that Zhongjia had entered into a non-binding Letter of Intent with China Shandong No. 3 Mineral and Geological Exploration Institute (“No. 3 Brigade”) to explore, and if appropriate, develop the Jincheng Gold Property (“Jincheng”), a 14.72 square kilometer concession contiguous with the Songjiagou Gold Mine.
Terms of the joint venture provide for Zhongjia to earn an 80% interest in the Jincheng Gold Property, based on an evaluation of prior work done on Jincheng that is to be determined by an independent evaluator that is mutually acceptable to Zhongjia and the No. 3 Brigade. Zhongjia may earn into 80% of Jincheng by paying an amount equal to 80% of the evaluation amount.
Once the joint venture is established, the companies agree to fund exploration and development of Jincheng on an 80/20 basis. Should the No. 3 Brigade choose not to fund their portion, their interest in the joint venture will dilute to a level no less than 8%.
As at September 30, 2015 and the date of this MD&A, no independent evaluation of the Jincheng Gold Property has been completed and the letter of intent is non-binding.
The Jincheng Gold Property is contiguous with Majestic’s Songjiagou property to the north and east. Jincheng mirrors the Songjiagou Gold Mine area geologically as both are situated in close proximity to major regional fault systems, the northeast trending Yazi fault zone and the northwest trending Tanjia fault zone. Both properties are predominantly underlain by Cretaceous aged conglomerate and related clastic