PNG government approves expanded Mt Kare JV
Madison Enterprises Corp MNP
Shares issued 16,577,900 Apr 17 close $1.97
Mon 20 Apr 98 News Release
Nell Dragovan reports
The Minister of Mines for Papua New Guinea has approved the expanded joint
venture agreement on the company's Mt Kare exploration project in Papua New
Guinea.
The Mt Kare property has been operating a joint venture between the company
and Matu Mining Pty Ltd, the company's Australian joint venture partner,
since September 1997. With the ministerial approval there is now a formal
expanded joint venture in place that governs all future exploration and
development at Mt Kare and one which has been approved by Madison, Matu,
Kare-Puga Development Corp Pty Ltd (KDC) representing the Mt Kare
landowners, and the government of Papua New Guinea.
The Mt Kare property lies 15km southwest of, and contiguous to, the Porgera
mine where Placer Dome and its partners have defined a total geological
resource of over 26 million ounces of gold. The Mt Kare property has
already produced an estimated one million ounces of gold from an alluvial
and colluvial gold rush in the late 1980s. Up to the end of 1997, the
company spent C$14 million and completed 89 diamond drill holes at Mt Kare.
This program outlined three deposits: the western roscoelite zone, the
central zone and the Black zone, all of which are still open to expansion.
Exploration is also progressing on peripheral targets and on new
discoveries on the property with a view to defining drill targets for later
this year. The company believes that the true potential of Mt Kare is only
beginning to be revealed and that Mt Kare may have potential similar to
that of the Porgera deposit next door.
Under the joint venture agreement, the Mt Kare property is owned by the
company and Matu as to 72.22% and 27.78%, respectively. Both Madison and
Matu hold 10% of their respective interests in trust for KDC which in turn
holds the 10% interest in trust (via the Mineral Resource Development Co
(MRDC) of Papua New Guinea, a governmental agency) for the traditional
landowners at Mt Kare. MRDC currently administers landowner trusts for
major mining and petroleum projects in Papua New Guinea. The company and
Matu have agreed to carry, on a pro rata basis, KDC's share of costs of
future exploration and development of the Mt Kare property until a
production decision is made, whereupon KDC becomes responsible for its 10%
share of future costs.
The company is the operator of the Mt Kare property and holds the majority
of votes on the joint venture's management committee. The landowner company
KDC is now included as a member of the joint venture's management
committee. The joint venture has undertaken to assist the landowners'
participation in the Mt Kare joint venture by setting up a site office for
KDC and providing KDC with professional management and with a budget which
will enable KDC to assist the joint venture in dealing with community
relations issues.
The joint venture has approved an exploration budget for the first six
months of 1998 (including the reimbursement of costs incurred from the
beginning of the year to date) totalling approximately US$4,000,000. The
major objectives of the work plan for the six month period include drill
testing along strike and down dip extensions of the western roscoelite and
Black zones and the engagement of an independent engineering firm to
produce a preliminary mineral resource calculation for Mt Kare. The program
will also see the continuation of geological mapping, auger soil sampling
and trenching to develop drill targets on priority areas such as the Lower
Maratani and Pinuni Creek areas and the southern extensions of the Black
zone and the western roscoelite zone.
The Mt Kare joint venture expects to continue its exploration in the second
half of 1998 with a drilling program to expand its resource base and follow
up targets generated during the first half of the year.
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com |
