"Although this information is not news generated directly from Terraco, we wanted to share a few recent events/announcements that relate to Terraco's Royalty Assets on the Spring Valley Project which is a Barrick led joint venture with Midway Gold.
First and most timely, Midway Gold announced yesterday (May 29, 2013) that Barrick's development drilling (designed to upgrade the quality of the resource) continues to produce excellent intercepts that included 361 meters of 1.47 grams per tonne (gpt) gold (including 21 meters of 7.54 gpt gold and 23 meters of 3.02 gpt gold. This is an amazing drill hole and our congratulations goes to Barrick and Midway.
This hole was roughly in the middle of the deposit (see Midway's press release further to the map) and lies within the claim block covered by Terraco's net smelter returns (NSR) royalty of up to 3%.....thus we are also excited about the great results. This drill hole is of greater width and grade than typical holes we have seen at Spring Valley and should further enhance the path to production story that Barrick is building at Spring Valley.
Secondly, and even more exciting to Terraco, Midway has announced (April 23, 2013 and updated in yesterday's release) that Barrick has earned its 60% interest in the Spring Valley project by spending in excess of $30,000,000. Barrick has also provided notice of an additional $8,000,000 in spending to earn 70% interest. The budget for 2013 includes $10 million for exploration and development.
Lastly, the 2013 work is aggressively underway by Barrick at Spring Valley where there are 4 drill rigs spinning. Based on Midway's release, the Barrick work underway includes:
- Resource modeling
- Metallurgical testing
- Hydrologic data for dewatering studies
- Core drilling for waste rock and ore geochemical characterization
- Design and evaluation of initial mine layout alternatives
- Initial pit slope stability studies
- Initial base line surveys
These developments are very encouraging. The Barrick path to production and therefore potential future cash flow from the project should create sizeable value with Terraco's (up to) 3% NSR royalty and royalty option on claims covering the known ore body at Spring Valley.
Barrick's continued great work at Spring Valley is a definite highlight for the mining space and the project is one of the fastest advancing path to production gold stories in Nevada.
In addition, and for comfort to our shareholders, we are fully funded for a 12-18 month time horizon with no need to go to the markets for equity financing. One of the value added components to our royalty and royalty option deals on Spring Valley, within the last 18 months, was the opportunity to bring in financing that was integral to the royalty asset transaction resulting in Terraco not having to issue equity except as part of the transaction payment to the royalty vendor. In other words, the total $6m (once the third transaction closes) in equivalent working capital was not at the behest of issuing Terraco shares and thus dilution was minimized.
We look forward to our continued development despite the tough markets.
For further detail on the Spring Valley updates, please see Midway Gold's website, further to their May 29, 2013 news, in order to see the map of the deposit or click below to directly link.
http://midwaygold.com/_resources/news/2013.05.29.pdf
Thank-you for your continued support."
--- Todd Hilditch, President & CEO
Terraco Gold Corp.
604-443-3831
The reader is invited to view Terraco�s corporate presentation (including detailed outline of the Barrick led NSR royalty assets in Nevada) contained in the link below:
Please always feel welcome to call at either of the numbers listed below.
Thank you as always for your time.
Matt
Please find the Terraco Gold Corporate Video with contained in the link below:
Terraco Gold Corporate Video
Please visit our website at:
http://www.terracogold.com/