Great Basin Increases Interest in Ivanhoe Project to 100 Percent
VANCOUVER, British Columbia--(BUSINESS WIRE)--March 22, 1999-- Robert G. Hunter, Chairman of Great Basin Gold Ltd. (VSE:GBG - news; OTC:GBGLF - news) is pleased to announce that the Company has entered into an agreement with Cornucopia Resources Ltd. and Touchstone Resources Company under which Great Basin will acquire all of the outstanding shares of Touchstone from Cornucopia.
Touchstone is a wholly owned subsidiary of Cornucopia and owns a 25% working interest in the Ivanhoe Project. Purchase of Touchstone will increase Great Basin Gold Ltd.'s interest in the Ivanhoe Project from 75% to 100%.
The consideration to be paid by Great Basin to Cornucopia will consist of 2,750,000 common shares and 250,000 warrants exercisable to purchase additional shares of Great Basin at $2.00 per share for one year. Great Basin has agreed that one nominee of Cornucopia will be appointed to Great Basin's board. Cornucopia has agreed to vote its shares of Great Basin in accordance with the instructions of Great Basin's board for a period of two years.
Resale of the Great Basin shares issued will be restricted, by agreement, for a period of twelve months. Cornucopia is also being granted a right to participate in future financings of Great Basin for a period of two years in order to maintain its equity interest.
Completion of the acquisition of Touchstone by Great Basin is subject to regulatory, stock exchange, and Cornucopia shareholder approval and other conditions precedent including a satisfactory due diligence review and the delivery of favourable opinions on matters material to the transaction.
Great Basin is focused on the discovery of a major gold deposit at the Ivanhoe property. The 21 square mile property is located on the prolific Carlin Trend, Nevada between the newly commissioned Ken Snyder Mine (Franco and Euro-Nevada) 14 miles to the northwest and the developing Rossi deposit (Barrick and Meridian Gold) 6 miles to the southeast.
The Ivanhoe property hosts two highly prospective areas for the discovery and development of large scale, high-grade gold deposits. These are the Hollister disseminated gold resource area and the Hatter mineralized area located 1.5 miles to the east.
Shallow drilling at Hollister by numerous operators from 1983 to present has defined a pre-mining geological resource of 84 million tons grading 0.034 oz/ton gold containing 2.8 million ounces of gold. This Hollister resource represents the largest, near surface deposit or ''leakage anomaly'' on the Carlin Trend which has not had its underlying feeder zones systematically explored by drilling.
Two obvious deposit targets at Ivanhoe are: (1) bonanza grade gold-silver feeder veins, similar to the nearby Ken Snyder Mine (2.73 million tons, grading 1.12 oz/ton gold and 12.82 oz/ton silver or 3.7 million gold equivalent ounces), emplaced underneath the Hollister deposit and; (2) more typical Carlin Trend style, carbonate-hosted gold deposits, similar to Meikle (6.8 million reserve tons grading 0.78 oz/ton gold containing 5.3 million ounces) or Post-Betze (134 million reserve tons grading 0.18 oz/ton gold containing 24.1 million ounces), deeper below each of the Hollister and Hatter mineralized areas.
Great Basin is currently developing detailed plans to undertake a major program of diamond drilling at the Property.
In other news, the common shares of Great Basin Gold Ltd. have commenced trading in the United States on the OTC Bulletin Board (Symbol GBGLF). The Bulletin Board is an automated exchange allowing real time access to the Company's stock price through brokerage systems as well as the Internet.
The move to the OTC Bulletin Board follows from the Nasdaq Small Cap Market rule change which requires a minimum bid price of US$1.00 per share. As well as trading on the OTC Bulletin Board, the common shares of Great Basin Gold Ltd. will continue to trade on the Vancouver Stock Exchange (Symbol GBG).
ON BEHALF OF THE BOARD Robert G. Hunter Chairman
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