Golden Phoenix advancing multiple projects in Panama,
Peru and Nevada
Steven Ralston, CFA
Golden Phoenix Minerals (
GPXM
)
formed a joint venture operating company (Golden Phoenix Panama
S.A.) with Silver Global to advance the Santa Rosa mine in Panama.
The Santa Rosa mine will be held, operated and mined by the JV, in
which Golden Phoenix can earn up to a 60% interest through the
advancement of the property through the completion of the
Environmental Impact Study, a NI-43-101 compliant technical report
with a measured and indicated resource estimate and a bankable
feasibility study. An additional 20% interest can be acquired upon
meeting certain other milestones. Golden Phoenix Minerals has
already engaged SRK Consulting (SRK) to prepare a resource estimate
and a NI-43-101 compliant technical report.
In addition, the Mineral Ridge property in Nevada continues to be
explored by Scorpio Gold in an effort to bolster reserves. Not only
does Golden Phoenix own a 30% interest in Mineral Ridge, but also
has option agreements to earn an 80% interest in the Vanderbilt
mine and the Coyote Fault properties, both of which are contiguous
to the Mineral Ridge property. Reverse circulation (
RC
) drilling results from the Brodie zone at the Mineral Ridge gold
project appear to have defined a mineralized trend over an 850
meter strike length, open in both directions. In particular, drill
hole MR11252 intersected a high-grade zone grading 5.19 g/t gold
over 24.39 meters. MR11252 was the drill hole far most to the
northwest and is on trend with the Bluelite zone located 1,370
meters to the northwest.
Lastly, Golden Phoenix is in the process of acquiring a 100%
interest (up from 80%) in five properties located in Peru due to
two amendments to the original definitive agreement. In June,
Golden Phoenix Minerals entered into the definitive agreement with
Sala-Valc S.A.C., a Peruvian corporation, to acquire an 80%
interest in the five Peruvian properties; however, subsequently,
the agreement has been amended twice such that Golden Phoenix will
be acquiring a 100% interest in the Peruvian properties for $37,500
in cash and 10,132,228 shares through two non-interest bearing
convertible note issues due on September 30, 2012 plus a perpetual
3% net smelter return royalty (
NSR
) granted to Sala-Valc S.A.C.
Management of Golden Phoenix Minerals is pursuing multiple projects
in various stages of development throughout North, Central and
South America, with a preference for advanced stage projects that
can brought to production within two years. After the projects are
developed to a certain stage, mine operations are outsourced to
motivated partners, who incur the costs of bringing each property
to production in exchange for a majority interest. Golden Phoenix
seeks to retain a minority ownership position, which preferably
will be converted into a royalty after a property reaches
commercial production. Management is pursuing this royalty strategy
with a sense of urgency.
We maintain our Outperform rating on Golden Phoenix.
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