Omineca Mining and Metals signs Wingdam gold JV letter with HMI
Omineca would retain a 50 per cent carried interest and receive half the recovered gold at a base cost of C$1,000 an ounce.
Mara Quinlan
Omineca Mining and Metals Ltd. CVEOMM said on Thursday it signed a binding letter of intent with HMI Mining for a 50 per cent Wingdam placer-gold joint venture in British Columbia. Omineca would retain a 50 per cent carried interest through and after commercial production, with HMI taking the operating role.
Google Finance showed the TSX Venture Exchange shares at C$0.04 as of 12:57 p.m. EST on Tuesday CVEOMM. That quote predates Thursday's announcement.
Under the Nov. 12 announcement, HMI would acquire an undivided half-interest and the exclusive right to mine all placer gold on the project claims. The agreement remains subject to acceptance by the TSX Venture Exchange.
Omineca's share of recovered gold would cost C$1,000 an ounce, plus C$250 an ounce until a five-year mine plan is submitted, according to the Nov. 12 release. The company did not give an operating start date or a deadline for submitting that plan.
HMI would serve as both joint venture partner and contractor, handling planning, engineering and underground operations. Its responsibilities would also include permitting, environmental monitoring, regulatory compliance, equipment and site services.
The carried interest extends beyond the start of commercial production, while Omineca would pay the stated per-ounce charge for its share of recovered gold. The announcement does not quantify an upfront payment, development budget or minimum funding commitment by HMI.
The release sets no minimum gold delivery volume, production target or recovery schedule, leaving the amount and timing of Omineca's receipts unspecified.
"The Agreement is subject to acceptance by the TSX Venture Exchange," the company said in the release.
The proposed partnership follows Omineca's Oct. 27 announcement that it had regained full control of Wingdam. Omineca said the insolvency trustee for its former partner had disclaimed that partner's interest in the underground project.
Omineca said in that earlier release it had engaged a temporary operator to maintain continuity at the mine site. Regaining control allowed it to negotiate directly with a development partner; Thursday's letter identifies HMI as that proposed partner and onsite operator.
Wingdam is an underground placer-gold recovery and hard-rock exploration property about 45 kilometres east of Quesnel, in the Cariboo mining district. Omineca says its placer claims extend more than 15 kilometres along the Lightning Creek valley, where buried gravels contain the gold targeted by the recovery project.
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Exchange acceptance is the next stated condition, but the Nov. 12 release provides no date for that step or the start of HMI's operations.
