HARTE GOLD CORP. and Technica Mining, a Sudbury, Ontario based mining contractor, are pleased to announce the signing of a Heads of Agreement on Harte Gold's Sugar Zone Deposit.
Highlights of the Agreement, Technica will:
- Mine the 70,000 tonne bulk sample under a $20 million fixed price contract.
- Receive $5 million of the fixed price contract amount in the form of Harte Gold common shares at $0.15/share, which shares will be held in escrow pending completion of the Bulk Sample.
- Receive 1/4 warrant/share exercisable at $0.30/share for 18 months following completion of the Bulk Sample.
- Be responsible for surface works, collaring the portal, underground development and mining work.
- Have the option to put the shares back to Harte Gold within a 36 month period following completion of the Bulk Sample at a 100% premium provided that any such purchases by Harte Gold account for no more than 25% of Harte Gold's free cash flow.
Highlights of the Bulk Sample:
- 70,000 tonne high grade Bulk Sample located close to surface
- First mineralized rock is expected in January 2016 at a rate of 300 tonnes/day
- Completion anticipated to be end of 2016
- Milling options are currently under review, including toll milling at nearby mills
- Financial arrangements are ongoing
Harte Gold is currently engaged in discussions regarding non-dilutive loan and/or gold off-take agreements. An optimized preliminary five year mine plan, based on the Corporations' Preliminary Economic Assessment dated May 31, 2012 has been designed by independent engineering consultants down to a 400 meter depth.
Stephen G. Roman, President and CEO of Harte Gold said: "We are extremely pleased to be able to announce this Agreement with Technica. They are a highly regarded and competent group that has an excellent track record, especially with their safety performance, having provided contract mining services to some of the largest mining companies in the Sudbury basin. We look forward to a long and mutually rewarding relationship."
Mario Grossi, President and CEO of Technica Group Inc. said: "We are equally pleased to make this announcement in working with the exceptional team at Harte Gold. It is in line with our approach to diversify and expand our portfolio of services to the mining industry. We are eager to expand beyond contract mining services and now offer unique financing solutions for our clients. It is projects like Harte's Sugar Zone that makes this offering possible."