Tuesday June 15, 4:36 pm Eastern Time
Company Press Release
SOURCE: Black Swan Gold Mines Ltd.
Black Swan Gold Mines Ltd. announces option to purchase Tejucana diamond project
VANCOUVER, June 15 /CNW-PRN/ - Black Swan Gold Mines Ltd.
Trading Symbol: TSE - BSW
BERLIN - BSM
FRANKFURT - BSM
Black Swan Gold Mines Ltd (''Black Swan'') is pleased to announce that it has entered into an option agreement with the local owners to purchase, subject to Toronto Stock Exchange acceptance and completion of due diligence review, the entire share capital of Mineracao Tejucana SA (''Tejucana''), a Brazilian registered company with diamond mining interests along the Jequitinhonha River in north-east Minas Gerais State, Brazil.
Tejucana undertook dredging operations along the Jequitinhonha River for over 20 years treating up to 6.5 million m(3) of gravel per annum and recovering up to 65,000 carats of diamonds and 4,800 ounces of gold per annum before ceasing production in 1996. Extensive mining records show that over 700,000 carats were recovered from approximately 20 kilometres of the 105 kilometres of contiguous mining leases along the river. Mining and exploration claims held by Tejucana total approximately 10,000 hectares with stated remaining resources standing at 335 million m(3) at an average grade of 0.008 carats/m(3). Tejucana also owns significant amounts of equipment and infrastructure including 4 large-scale bucket wheel dredges, which have been under care and maintenance.
Black Swan has signed an option agreement giving it the right to conduct a due diligence exercise over Tejucana and its assets by September 5th, 1999. Upon exercise of the option by Black Swan it must pay US$1.7 million in cash and issue two million common shares and two million two-year options at a strike price of C$0.50 per share to the vendors, subject to regulatory approval. The due diligence exercise will include a legal and financial audit of Tejucana as well as technical and environmental investigations of its equipment and properties and resource estimations.
During the option period Black Swan will also produce a detailed scoping study into the viability of restarting profitable operations at Tejucana's properties using selective mining techniques and the existing low cost dredging equipment.
Speaking today Mr Stephen Fabian, President of Black Swan, said ''although we need to undertake further investigations, I believe that the acquisition of Tejucana could supply Black Swan a positive cash flow fairly quickly, providing an excellent platform upon which to build on our diamond exploration and production strategy in Brazil.''
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY OF THIS RELEASE.
WARNING: The Company relies on litigation protection for forward-looking statements.
SOURCE: Black Swan Gold Mines Ltd. |
