Radius Gold (RDU-V) June 14, '16 is pleased to provide an update on recent activities including ongoing target generation and exploration work, the status of the Tambor gold mine in Guatemala in which Radius holds a royalty interest, and the value of present equity and cash holdings and other royalty interests.
Tambor Gold Mine
On May 11, 2016, KCA informed Radius that mining operations were suspended by the Supreme Court of Guatemala reportly due to a lack of consultation by the Government with local indigenous peoples when the mine was permitted in 2011. The Supreme Court is now evaluating the issue, but pending the Court's decision the mine has remained closed. The suspension was in response to an Amparo (essentially a lawsuit brought as a guarantee of protection of an individual's constitutional rights) brought against the mine by CALAS (Centro de Acción Legal Ambiental y Social de Guatemala), an NGO focused on environmental and social issues.
To date, the Supreme Court has still not made a decision on when the mine may re-open. An unfortunate consequence of the delay in delivering a final decision is that KCA, which has been left with no choice in the absence of cash flow from gold sales, has now given lay-off notices to hundreds of local employees. KCA have retained a small crew on-site to maintain the plant. More than 300 employees recently travelled to the offices of the Constitutional Court, the Supreme Court, and the President of Guatemala, to deliver the message that they want and need the jobs provided by the Tambor mine.
Ironically, CALAS's legal action for "social justice" has now resulted in the loss of hundreds of permanent jobs at a fully-permitted mine that was regularly inspected by the Guatemalan government and was operating in full compliance with the local mining and environmental regulations. KCA and Radius have invested many millions over the years on this property, establishing a significant gold resource and a fully permitted mining operation. Unless some clarity on the situation is given soon by the courts, KCA and Radius will be seeking legal advice on restoring operations, including the much-needed jobs, at Tambor.
Exploration Update
Spring Peak Property, Nevada
We are pleased to announce that Radius has acquired an option to earn a 100% interest in the Spring Peak gold property in Mineral County, Nevada, from Kinetic Gold (US) Inc. The Spring Peak Property consists of 37 contiguous US Federal Mineral Claims comprising 309 hectares located approximately 37 km southwest of the town of Hawthorne, NV; access is good.
The Property is situated in the historic Aurora-Borealis-Bodie mining district which lies within the Walker Lane gold trend of western Nevada. The gold deposits in the Aurora-Borealis-Bodie district occur as both high grade vein-hosted low sulphidation deposits (Aurora, Bodie), and as high-sulphidation alunite-kaolinite gold-deposits (Borealis). Total historical precious metal production along this trend, from the mid-19th century to the mid-1990s, has been estimated at 4.0 million ounces Au, and 11.2 million ounces Ag (MDA, 2002).
The Spring Peak Property is approximately 6 km southeast of the historical open pit mines at Aurora. At Spring Peak, a sinter terrace is exposed overlying altered volcaniclastic deposits and basement Cretaceous granites (USGS, 2012). The sinter system contains anomalous concentrations of Au, Ag, Hg, Sb, and As. Recent ash fall deposits cover much of the area, but frequent vein float with multi-ppm gold concentrations can be found across the Property. The area was drilled with shallow holes in the 1980s, the majority of which were vertical. The sinter terrace and potential structures beneath it were never adequately drill tested. Radius believes the Property has the potential to host subvertical high grade veins as feeders to the sinter terraces.
Radius plans to conduct a CSAMT geophysical survey over the Property to test the hypothesis that subvertical high grade vein deposits may exist in 'feeder' structures below the sinter terraces.
Spring Peak Option Terms
The Company can earn a 100% interest in the Spring Peak Property by making a cash payment to Kinetic of US$15,000 on signing (paid) and further expenditures as follows:
cash payments to Kinetic totalling US$430,000 over the first five years following the issuance of a drill permit for the Property, and then US$250,000 in each subsequent year until the option is exercised or terminated; and
a total of US$725,000 in permitting and exploration work on the Property, over three years following the issuance of the drill permit.
At any time while the option is in good standing, the Company may elect to deliver to Kinetic a technical report, complying with NI 43-101 standards, which documents a minimum 500,000 ounce gold equivalent inferred resource on the Spring Peak Property, and upon said delivery, the Company will have the right for one year thereafter to purchase from Kinetic an outright 100% interest in the Property for the sum of US$500,000.
If the Company completes the purchase of the Spring Peak Property, a combined 3.0% net smelter returns royalty will be granted to Kinetic and the underlying property owner. Up to one-half of the royalty may be purchased for up to US$1.5 million.
Other Properties
The Company continues to evaluate projects in various jurisdictions and with various commodities but with a focus on gold and silver in Nevada and Mexico. Our Guatemala concession holdings at Banderas remain in good standing and the exploration potential on those properties is high, but with recent developments at Tambor, it appears the pro-mining rhetoric of the new government is yet to be confirmed.
In Mexico, Radius has a silver project optioned to Fortuna Silver Mines.
Equity and Other Holdings
Radius currently has just over $5 million cash in the treasury. Present equity holdings are listed below:
| | | No. of Shares | | Current Value | | B2Gold | | 300,000 | | $834,000 | | Focus | | 3,433,406 | | $274,000 | | Medgold | | 8,040,000 | | $924,000 | | Southern Silver | | 2,000,000 | | $880,000 | | Rackla | | 2,973,275 | | $237,000 | | | | $3,149,000 | | $3,149,000 |
Radius also holds a 2% NSR on 70% of the Bayovar12 Phosphate deposit owned by Focus Ventures Ltd.
Qualified Person
David Clark, M.Sc., P.Geo., is Radius's Qualified Person under the terms of National Instrument 43-101, "Standards of Disclosure for Mineral Projects" and has approved the technical information in this news release.
About Radius
Radius has been exploring for gold in Latin America for over a decade. The Company has a strong treasury and is looking for investment and project acquisition opportunities across the globe. Please call toll free 1-888-627-9378 or visit our web site ( www.radiusgold.com) for more information.
ON BEHALF OF THE BOARD
Simon Ridgway
President and CEO
Simon Ridgway
200 Burrard Street, Suite 650
Vancouver, BC V6C 3L6
604-662-8829
Tel: 604-801-5432 or Toll free 1-888-627-9378
Email: info@goldgroup.com
Website: www.radiusgold.com |
