Shares of Colombian Mines (TSX: V.CMJ, Stock Forum) surged 13% to $1.02 on Monday after the junior explorer said it has granted Yamana Gold (TSX: T.YRI, Stock Forum) the option to earn an interest in the company’s Anori gold project in Colombia. Under the deal, Yamana can earn an 80% project stake by funding exploration and delivering a mine feasibility study. Anori completely surrounds Yamana’s 179-hectare Solferino project.
Yamana may earn a 60% interest by a) paying US$1 million to Colombian Mines, b) fully funding at no cost to Colombian Mines, US$2 million in exploration expenditures and c) completing a fully compliant NI 43-101 technical report defining mineral resources and mineral reserves, of which a minimum 30% must be classified in the proven and probable mineral reserve categories. All of the foregoing must take place on, or before, the fourth anniversary of the agreement.
Yamana may elect to earn an additional 20% interest by notifying the company, and then fully funding a feasibility study that could be used to secure project financing within three years of earning its initial 60% interest. Colombian Mines will receive US$50,000 upon closing.
“We are really pleased to be working with Yamana, as this is the first significant joint venture deal for our company. Further, the Solferino-Anori land package now being managed by Yamana is their first significant exploration project in Colombia. The high-grade gold veining and structural zone that has been mined historically, and again more recently at Solferino, is dominantly an underground mineable high-grade target, but does have the potential for near surface bulk-tonnage mining. The joint venture parties believe that the newly-optioned Anori property package has excellent potential to host similar gold zones along strike to Solferino, and in related parallel to sub-parallel structures,” Colombian Mines CEO Nate Tewalt told Stockhouse.
He added that with the size of the newly-combined property package, they realize that Yamana now has a much better chance of finding a viable gold deposit, and that would be good for everyone. “With the South American high-grade underground mining experience Yamana has at places such as El Penon in Chile, they are proven miners and should be well equipped to assess deposits of this type.”
For more insight into the Colombian Mines story, please read the columns by Ticker Trax’s Thom Calandra.