Ashburton pays second tranche for Obi gold project acquisition deal
Monday, March 14 2011 - 07:11 AM WIB
Under the deal, Ashburton secured an exclusive 12 month option period by payment of the first tranche of $500,000 on 10 December 2010. The third tranche is due in three months? time, pending achievement by Eka of certain milestones related to the construction of a gravity gold processing plant within the artisanal Small Scale Mining Area sited within Eka?s tenement, the company said.
Ashburton needs to fund exploration activities up to a minimum of $1 million within the 12 month option period. In this respect, a drilling rig has been contracted to complete a 3,000m - 4,000 m diamond drilling programme at Obi. The contractor, PT Indo Asia Resources, is due to mobilise the rig and equipment from Jakarta and Balikpapan this week, it said.
At the conclusion of the 12 month period, Ashburton will have the option to acquire a 51% interest in Eka by payment to the founding shareholder of Eka $2 million and issuing to the Founder 30 million fully paid Ashburton shares.
Ashburton will then have a further 3 years in which to spend a further US$2.5 million on exploration, at which time Ashburton can elect to earn an 85% interest in Eka by a further payment to the Founder of US$2.89 million and an issue of a further 30 million fully paid Ashburton shares.
Eka is the holder of a 77 sq km exploration licence (IUP Eksplorasi) on Obi Island. The IUP encompasses a 300 ha small scale mining area which contains numerous artisanal workings exploiting a series of epithermal gold-silver-base metal quartz veins within an area some 400 m wide and over 1 km in length.
Random sampling by Ashburton geologists of 15 samples of artisanal run-of-mine ?ore? produced average grades of 16.17 g/t Au, 0.56% Pb and 0.46% Zn. (kanti)