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Sierra Nevada Gold Inc (ASX:SNX) is set to increase its footprint in the US southwest, with the acquisition of the New Pass gold mine in Nevada, which historically produced the yellow metal at an average grade of 17 grams per tonne.
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Since 2012, the company had been leasing the gold mine from the family of Don Jung – a mining engineer and owner of New Pass. With its agreement to buy New Pass, SNX has ended the ending this lease/purchase option agreement, as well as attaching royalty over 12 claims on the site.
The latter – in addition to the mine – will now form part of SNX’s larger New Pass project, with the company taking on not only the mine, but its associated infrastructure, property and stockpiles.
According to the agreement, SNX will be able to kick off its assessment of various mining proposals which would include bulk sampling at existing and accessible deposits.
One key focal point for future gold production options will be the Superior high-grade gold vein, with the company intending to bulk sample the vein from the level 4 adit, where it is exposed and accessible.
SNX executive chairman Peter Moore said the decision to purchase New Pass offered several options for exploitation of this mineralisation.
“Purchasing the key claims covering the historic high grade New Pass Mine is a very positive step for the company, providing SNX the opportunity to assess potential for re-establishing gold production from existing underground workings,” he said.
“Our preliminary work and detailed underground surveys in recent years have indicated that the mine has potential to re-open.
“The company looks forward to expediting its evaluation of New Pass over coming months.”
SNX has been trading at 2 cents.
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