The pre-drilling exploration results at the Project – which included: detailed hydrogeochemistry; vegetation and soil surface geochemistry (including soil gas mercury); the acquisition and reprocessing of two historic seismic geophysical lines; geologic mapping; and a gravity geophysical survey – have provided a strong geologic, geophysical, and geochemical case for a series of drill holes to test for: (a) the depth to reactive lower plate host rocks, and (b) the presence of a geochemically anomalous, hydrothermal alteration system large enough to host a significant Carlin-type gold deposit. Based on these results, McEwen Mining has notified NGE that it has now commenced drilling at the Project.
For a more detailed description of the Project refer to NGE’s Grass Valley Project update news release dated August 12, 2013.
Grass Valley Exploration Agreement
As per the terms of the Exploration Agreement, McEwen Mining and NGE’s interests in the Grass Valley Designated Property are 70% and 30% respectively. McEwen Mining is the project manager, has sole discretion on the nature and timing of all exploration and development activities, and is solely responsible for payment of all costs incurred in respect of the project. As McEwen Mining elects to continue to maintain the Grass Valley Designated Property, McEwen Mining will pay NGE $100,000 USD on the first through fourth anniversaries of acquiring the Designated Property, and then $250,000 USD on each subsequent anniversary. If McEwen Mining completes a Production Decision Report on the Designated Property that McEwen Mining deems sufficient to base a decision to commence production, the Designated Property will advance under a Joint Venture agreement, at which time both parties will be required to fund their pro rata share of project expenditures or be diluted. If either party’s interest is diluted below 10%, such party’s interest converts to a 2% NSR.
