VANCOUVER, BRITISH COLUMBIA--(Marketwire - Mar 3, 2013) - BCGold Corp. (TSX VENTURE:BCG)(BCGOF)("BCGold" or the "Company") is pleased to announce it has signed a Letter of Intent ("LOI") with Solid Holdings Ltd. ("Solid") whereby Solid will finance and construct a minimum 30 tonne per day turn-key mine, mill and gold refining operation (the "Engineer Mine") at BCGold Corp.''s historic Engineer Mine property, situated 32 km west of Atlin, British Columbia. Within a 3 year time-frame Solid is required to produce a minimum of 10,000 ounces of gold, with 1,500 ounces to BCGold''s credit, on a gross-sale basis from the Engineer Vein on 6 and 7 Levels of the underground mine workings. Upon completion of these provisions, Solid may elect to acquire a 50% interest in the Engineer Mine by way of a joint venture agreement ("JV") with BCGold Corp. (see Proposed JV Terms below).
Further details of the 3 year earn-in period are as follows:
- BCGold and Solid have 45 days to complete due diligence and finalize a definitive agreement
- Solid will provide engineering, procurement, design, civil works and other construction expenses, as well as all administrative and infrastructure expenses associated with the Engineer Mine
- Solid will cover all operating and initial/ongoing capital costs associated with the Engineer Mine
- Solid will retain 85% of gross gold sale proceeds (remaining 15% to go to BCGold Corp.) of the initial 10,000 ounces of gold production in the form of dore bars or marketable gold-rich concentrate
"BCGold is very pleased to enter into this agreement with Solid," states Brian P. Fowler, P.Geo., President and CEO of BCGold Corp. "This agreement provides BCGold Corp. with cash flow during the 3 year earn-in period and a 50% interest in a fully functional mine and mill complex at no cost to the Company. Management of BCGold and Solid believe that previous exploration and bulk sampling results at Engineer Mine substantiates the basis for a sustainable small-scale gold mining operation."
Proposed JV Terms
Should the terms of the LOI be met, and Solid choose to enter into a JV with BCGold Corp., it will entail a 50/50 split ownership of the Engineer Mine and surface and mineral rights of the crown grant property, with certain specified exceptions. The JV will be responsible for management and operation of the Engineer Mine, including all associated operating and ongoing capital costs, as well as near-mine exploration and resource definition. Net proceeds from gold sales will be distributed to the JV partnership on a 50/50 basis.
BCGold Corp. will retain 100% mineral rights to the Hub A, Hub B, Shear A, and Shear B bulk tonnage exploration targets. BCGold Corp. will also retain the Guardsmen option, where the Company may earn up to 100% interest in the surrounding 2,104 ha Gold Hill property (see news release dated October 4, 2010).
Should Solid elect not to proceed with the JV, BCGold shall have right of first refusal with respect to any infrastructure proposed to be sold by Solid.
About Solid Holdings Ltd.
Solid Holdings Ltd. is a private company headed by Stan Spletzer of Houston, British Columbia. Mr. Spletzer, President of Solid and President of Solid Gold Capital Inc., a finance company focused on new mineral projects, brings over 30 years of contracting experience related to aggregate mining, road construction, logging, and silviculture in northern British Columbia. Solid owns and operates a gold processing plant and assay lab in Houston and holds contracts with several local mining projects. It intends to construct a similar plant at Engineer Mine.
Solid has partnered with High Velocity Training and Cobra Mining & Excavating Ltd. to set up equipment training projects throughout British Columbia and Alberta that bring industry and First Nations together in profitable partnerships. It is envisaged that a similar partnership will occur at Engineer Mine.
About Engineer Mine
Engineer Mine was a high-grade gold producer that came to peak production in the mid-1920s and ceased operation in the early 1930s. More than 560 kg (18,000 oz) of gold and 278 kg (8,950 oz) of silver were officially produced at realized grades exceeding 39 g/t Au and 20 g/t Ag, primarily from the Engineer and Double Decker veins on six of eight mine levels. There is more than 5,500 m of underground development in place, which provide access to seven high-grade gold veins and two bulk tonnage mineralized shear zones. Surface exploration work has shown there are 25 known veins on the property. All veins remain open at depth and little exploration has been conducted deeper than 200 m below surface.
BCGold Corp. has incurred $3.6 million in acquisition, exploration and development expenditures at the Engineer Mine since 2007. The Company''s work includes the definition of an NI43-101 Inferred Mineral Resource of 41,000 tonnes grading 19.0 g/t Au, representing remnant portions of the Engineer and Double Decker veins down to 8 Level (see news release dated March 4, 2011).
In 2011, BCGold Corp. successfully test-milled a 246 tonne bulk sample from 5 Level of the underground workings (see news release dated February 27, 2012). Bulk sampling returned results up to 68.9 tonnes grading 44.6 g/t Au and resulted in the discovery of two high-grade gold-shoots partially outside of the Inferred Resource of the Engineer vein. In 2012, the Company confirmed these high-grade shoots have a vertical down-dip plunge by dewatering, geologically mapping, and panel sampling 6 and 7 Levels of the mine workings. The two high-grade gold-shoots represent an exploration target of 6,000 to 8,600 tonnes, grading 30 g/t to 60 g/t Au, for up to 17,000 ounces of contained gold(*).
(*The potential quality and grade of this exploration target is conceptual in nature, as there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource.)
BCGold Corp. owns a 100% interest in the Engineer Mine property with no underlying royalties. The Company holds all necessary operating permits to dewater the mine workings, and mine and mill an initial 4,000 tonne bulk sample. The Company will apply to increase the bulk sample tonnage permit on an as needed basis.
About BCGold Corp.
BCGold Corp. (TSX VENTURE:BCG) is focused on exploration and development of its 100%-owned historic Engineer Mine and the adjoining Gold Hill properties, situated in northwestern British Columbia. Since 2007, the Company has incurred approximately $3.9 million in expenditures to demonstrate the exploration upside and near-term mining potential of these properties.
BCGold Corp. has generated 27 early to mid-stage gold and copper-gold properties in British Columbia and Yukon that it will continue to advance through sourcing preferred joint venture partners.
BCGold Corp. is unique in that it exposes investors to the prospect of discoveries while being positioned to offset exploration costs by monetizing / forward-selling gold concentrate recovered from on-site processing of high-grade gold bulk samples at Engineer Mine.
On behalf of the Board of Directors,
Brian P. Fowler, P. Geo., President & CEO
Some statements in this news release contain forward-looking information or forward-looking statements. These statements include, but are not limited to, statements with respect to future expenditures and exploration, development and production activities. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, among others, the timing and completion of contemplated financings, the actual use of proceeds, receipt of regulatory approvals and the timing and success of future exploration, development and production activities. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise except as otherwise required by applicable securities legislation.