Issue link: http://resourceworld.uberflip.com/i/119004
MINI NG Eagle Mountain Gold acquires all of advanced-stage Guyana gold property by Peter Caulfield Omai Gold Mines Ltd., a 95%-owned subsidiary of IAMGOLD Corp. [IMG-TSX], recently acquired 3,236,246 shares of Eagle Mountain Gold Corp. [Z-TSXV EMGCF-OTCQX, E9X-FSE], increas, ing Omai Gold Mines' total ownership of the company to 14.93%. The transaction follows the exercise of an option held by Eagle Mountain Gold to acquire from Omai Gold Mines the remaining 50% interest in the advanced-stage Eagle Mountain gold property. The property, located in Guyana, South America, hosts a near-surface gold deposit of 188,000 indicated and 792,000 inferred gold ounces with considerable potential for expansion. The closing of the transaction gives Vancouver, BC-based Eagle Mountain Gold 100% ownership of the property and establishes IAMGOLD indirectly as the company's largest shareholder. In an announcement, Eagle Mountain's, president and CEO, Yannis Tsitos, said, "IAMGOLD increased their ownership stake in our company, in conjunction with increasing our interest to 100% in the Eagle Mountain gold project, it is a significant milestone. IAMGOLD has been positioned as a strategic partner. Becoming our largest stakeholder demonstrates confidence in our team's ability to develop the Eagle Mountain gold project." Sprott Asset Management, through the Sprott Gold and Precious Metals Fund, also holds a significant position in Eagle Mountain Gold. The Eagle Mountain property is located approximately 200 km southwest of Guyana's capital, Georgetown, and 45 km from the historic Omai Gold Mine. The mine profitably produced almost 4 million ounces of gold at an average grade of 1.4 g/t until 2005. Historical production from the general Madhia area is estimated at over 1 million ounces of gold from alluvial and eluvial sources. Other successful Guyanese operations include Guyana Goldfields Inc.'s [GUY-TSX] Aurora Project, which contains approximately 6.5 million ounces of gold; Sandspring Resources Ltd.'s [SSP-TSXV] multi-million ounce Toroparu gold-copper deposit, which is slated to go into large-scale production in 2015, and Azimuth Resources Ltd.'s [AZH-TSX; AXH-ASX] West Omai Project, which contains approximately 1.2 million ounces. In addition to this activity by mining companies, artisanal miners in Guyana produce over 300,000 ounces of gold per year. In addition to the Eagle Mountain property, the company has an option to acquire up to 95% of Mowasi, a 17,000-hectare gold project directly adjacent to Eagle Mountain. Mowasi has a history of artisanal gold mining from alluvial workings and saprolite. Limited exploration of the Mowasi property started in the first quarter of 2012. According to Eagle Mountain Gold, Guyana has one of the most mining-friendly governments in the world. The country has a con44 www.resourceworld.com Anne Casselman, Exploration & Country Manager, Senior Geologist (right) and Kevin Pickett – M. Sc, Senior Geologist (left) work on core from the 2011-2012 drilling campaign at the Eagle Mountain gold project. Photo courtesy of Eagle Mountain Gold Corp. sistently stable economy and political climate, with a long history of successful foreign investment in the country's mining sector. Its elected government has followed a policy of economic liberalization and promotes foreign investment. Its British-based law and robust mining law protect foreign investment. The Eagle Mountain project contains an existing shallow NI 43-101-compliant resource, with 188,000 ounces (indicated), average grade of 1.49 g/t gold (0.5 g/t gold cut-off) and 792,000 ounces (inferred), average grade of 1.19 g/t gold (0.5 g/t gold cut-off). Mineralogical and metallurgical testing completed at SGS Canada Inc.'s laboratories in Toronto shows strong recovery potential of up to 92%, which, the company says, is in line with recoveries from other mines in the region. Eagle Mountain Gold is working aggressively to start production at its Eagle Mountain property by the end of 2014. The company says the deposit has the potential for lower-cost, open-pit production, as the deposit covers only 250 hectares of the 5,050-hectare property. It is open in three lateral directions and at depth, with strong mineralization along its edges. With gold starting at surface on the property, Eagle Mountain's goal is to complete a scoping study and, subject to the results, a feasibility study with the goal of proving that the resource is suitable for low-cost, open-pit mining. The property has excellent access and is close to infrastructure, including existing roads, a small airport (within 4 km) and waterways. To date, over $16 million has been spent on exploration work at Eagle Mountain. Expenditures include 281 holes drilled totaling 35,993 metres; some work was completed by other companies, including IAMGOLD; 78 drill holes (about 11,000 metres) were comAPRIL 2013