Fronteer looking for producing gold assets
miningweekly.com
By: Liezel Hill
24th August 2009
Updated 4 hours ago
TORONTO (miningweekly.com) – Vancouver-based junior Fronteer Development Group is “actively” looking for a chance to enter the ranks of gold producers through corporate activity, CEO Mark O'Dea said on Monday.
The company is exploring for gold, copper and uranium in the US, Canada and Turkey, and expects to start up the first mine in its pipeline by early 2013.
Meanwhile, though, the firm is still looking for ways to become a gold producer “in the near term”, O'Dea told analysts and investors on a conference call.
“We have been very active on the merger and acquisition front, looking at opportunities in good jurisdictions,” he said.
The company sees achieving producer status as vital to achieving a rerating in its stock to reflect the value of its current portfolio of projects.
“Right now, we are on track to produce for ourselves over the next couple of years, but if there is an opportunity to get there sooner than the next three years, and the deal made sense, then we would pursue it,” O'Dea said.
Fronteer plans to complete a preliminary economic assessment on the first of three Nevada gold projects, Long Canyon, by the end of this year, and is hoping to start production at the mine by 2014, said COO Troy Fierro.
The project, in which Fronteer owns 51%, has an indicated resource of 363 000 oz at an average grade of 2,35 g/t gold, plus an inferred resource of 459 000 oz at an average grade of 1,63 g/t gold.
“Long Canyon is more than just a promising deposit, it's potentially a new gold district,” Fierro said.
Fronteer will complete an updated resource estimate in 2010 for Long Canyon, as well as for the firm's second Nevada prospect, the Sandman project.
The asset is co-owned with Newmont Mining, which is earning into a 51% holding in the project, and the Sandman mine remains on track to start producing gold either in late 2012 or early 2013, Fierro said.
Finally, in Nevada, the firm also plans to complete a preliminary economic assessment on its Northumberland asset in 2011.
In Canada, the company acquired the Michelin uranium project, in Newfoundland and Labrador, when it bought Aurora Energy Resources, earlier this year.
A scoping study on Michelin is due out in the next couple of weeks, with initial estimates for project economics.
Fronteer also co-owns two gold projects and one copper/gold porphyry project in Turkey, with Vancouver-based Teck Resources.
Teck is trying to sell the gold projects as part of its programme to divest noncore assets, and Fronteer will also sell its 40% interests as part of any transaction.
O'Dea said he expects there should be a resolution to the sale process “in the next couple of weeks”.
Teck and Fronteer plan to hold onto and develop the Halilaga copper/gold asset but are currently waiting for forestry permits for new drill roads at the project.
Fronteer shares slid 3,2% on Monday, to C$4,50 apiece by 14:19 in Toronto.
The stock has almost doubled this year, since ending 2008 at C$2,38 a share. |
