A SWG Baby...
Golden Sitka Resources Inc -
Golden Sitka enters JV agreement with Falconbridge
Golden Sitka Resources Inc
GSZ
Shares issued 4,509,467
2000-06-13 close $0.34
Wednesday Jun 14 2000
Also Falconbridge Ltd (FL)
Mr. John Paterson reports
Golden Sitka Resources has signed a letter agreement with Falconbridge Limited
covering two project areas within the Sudbury district, Ont. The two areas include
the Foy and Footwall properties described below.
Foy project
This project is located 30 kilometres northwest of Sudbury and comprises about
1,950 hectares of patented and unpatented claims. Within the boundary of the
project area is a 10.5-kilometre strike length of the Foy offset dike which is host
to numerous copper-nickel-platinum-palladium prospects.
Footwall project
This project is located 15 kilometres northeast of Sudbury and comprises about
1,600 hectares of patented and unpatented claims. The area is underlain by an
eight-kilometre strike length of Sudbury norite and sublayer rocks which host the
Falconbridge and Falconbridge East mines. A three-kilometre portion of this
prospective unit is covered by overburden and the area has significant potential to
host copper-nickel and platinum-palladium deposits.
John Paterson, president of Golden Sitka, stated: "This agreement with
Falconbridge gives our company the opportunity to explore highly prospective
ground in Sudbury not previously available to a junior company. In conjunction
with the platinum-palladium prospects we have acquired in various parts of
Ontario, the Falconbridge joint venture establishes Golden Sitka as one of the
premier copper-nickel-platinum-palladium junior exploration companies in
Canada."
Under the terms of the letter agreement, Golden Sitka will have the option to earn
a 60-per-cent interest in both projects from Falconbridge by expending $6-million
on exploration over three years. During the first year of exploration, a minimum of
$1-million must be spent. Once Golden Sitka earns its 60-per-cent interest, the
joint venture partners will contribute on a pro rata basis. Falconbridge will have
the option to increase its working interest in any specific project to 70 per cent by
financing a bankable feasibility study and providing 100 per cent of the funds to
put a deposit into production. Falconbridge will be entitled to recover mine
construction costs from 90 per cent of net cash flow from a mine.
Within the three-year option period, Falconbridge will have the right to purchase
by way of private placement up to 500,000 shares of Golden Sitka at a price
equal to the closing price for the 10 trading days prior to Falconbridge's notice to
purchase the shares. The final agreement is subject to approval of the management
of Falconbridge and Golden Sitka.
The conclusion of a final agreement with Falconbridge is also subject to receipt of
regulatory approval for Golden Sitka's proposed reorganization plan, as
referenced in its news releases in Stockwatch Feb. 29 and May 12, 2000. The
proposed reorganization was approved by the shareholders of Golden Sitka at the
annual and special meeting of shareholders held on May 12, 2000. The
reorganization plan includes a consolidation of the company's shares on a basis of
4 for 1, a change of name to Aurora Platinum Corp. and a private placement
financing for total gross proceeds of $1.25-million, among other matters.
No finder's fee is to be paid regarding the agreement and Falconbridge and
Golden Sitka are not related parties.
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