Agreement reached with Thabex Exploration
Pure Gold Minerals Inc PUG
Shares issued 26,379,471 May 26 close $0.84
Wed 27 May 98 News Release
Mr. Donald Sheldon reports
Pure Gold Minerals has reached an agreement with Thabex Exploration, a
publicly trading (Johannesburg Exchange) South African diamond exploration
company, to acquire a 51 per cent interest in its diamond concessions in
South Africa. The main project, known as the Douglas project, is 450
hectares in size and contains 3.65 million tonnes indicated diamondiferous
reserves at an average grade of 1.1 carat per 100 tonnes at an average
expected price of $800 per carat. Mining of this project began April 15,
1998, and is being increased from the current 100 tonnes per month (from
exploration trenching) to actual production, at a rate of 50,000 tonnes per
month within the next 90 days.
During the first 30 days of production a total of 160 carats were extracted
from one of the four terraces. All the stones were of gem quality and had
an average size of 1.1 carats.
Some of the larger stones were a clear (VVSI) 3.67 carat, a yellow (fancy)
3.80 carat and a pure white 6.67 carats. The first 3.67 carat stone
recovered during April is valued at $1,300 (U.S.) per carat. The 6.67 carat
stone is valued at $1,100 (U.S.) per carat.
Pure Gold has incorporated a subsidiary in South Africa (Pure Diamonds
(Pty) Ltd.) where the Douglas project as well as a Kimberley office and
database will be kept. The Kimberley office will provide a regional base
for the project and the database consists of extensive geological and
exploration data and information on more than 600 mineral occurrences
situated in South Africa, Namibia, Botswana, Swaziland, Lesotho, Zimbabwe,
Zambia and Angola.
Pure Gold will finance a total of $2,000,000 over the next 12 months to
earn a 51 per cent interest in the project. The cash flow from the project
should provide positive financing to Pure Gold as funds are advanced. Funds
on hand, earmarked for the Alberta diamond project, will not be used for
this new venture. After Pure Gold vests its interest, the parties will form
a joint venture. A finder's fee will be paid in respect to the above
acquisition. |
