North Bay Resources Inc. (OTC:NBRI) has entered into a 50-50 joint venture earn-in agreement with MGX Minerals for the Fran gold project located in British Columbia.
North Bay can earn up to an initial 30% interest in the project by completing a resource estimate and producing 2,500 ounces of gold within a year. It can earn up to a 50% stake after mining an additional 2,500 ounces of gold within two years.
After the earn-in agreement, it will be run as an equal joint venture, with North Bay acting as the project operator.
CEO Jared Lazerson joined Proactive to discuss the joint venture opportunity and also provide an update on work at the company’s Bishop Gold Mill located in California.
Proactive: The company has struck a joint venture deal with MGX Minerals on the Fran gold project. Let’s talk about the project itself first. Tell me what you liked about this one?
Jared Lazerson: I’ve known this project for a while and its history. It’s an advanced project. Development has been going on in one shape or form going back to about 2001. There has been more than 50,000 feet of drilling in 104 holes, so it’s a well-defined gold deposit. We are moving immediately toward a resource estimate. We actually had a crew on the ground last week prior to the announcement doing a little due diligence and check sampling, and delineating an initial bulk sample area. We’ve identified about 5,000 tons in volume near-surface over multiple trenches.
The deposit is a vein deposit. There are three to four parallel veins and there may actually be a fifth slightly down the hill. When we were looking at the drilling, that seemed to line up. We’ll save that for later exploration. But right now we’re looking at bringing in the excavator and taking bulk samples and seeing what we’ve got. The grades are very consistent in the veins, above a quarter ounce and then anywhere up to two ounces in drill core and about 1.8 ounces in trenches. It’s very strong. We’re just lining up how exactly to get it out but the first step is obviously the bulk sample and resource estimate.
It's key that you’re going to be running the operations. North Bay is going to be the operator of the project, correct?
Exactly. We’re the operator, we call the shots. The joint venture agreement, it’s a 50-50 joint venture, but the earn-in is focused on production, bringing things far enough along that we can make a major production decision. I don't want to speculate but that could potentially be 100,000 tons or more. North Bay is the operator and we’re pushing hard. We’re fairly aggressive on our acquisition and exploration these days.
Can you provide an update on the Bishop Gold Mill? The last time we talked, you mentioned there’s a lot of work going on getting that restarted.
We acquired the Bishop Gold Mill on April 1. Everything has been checked on the equipment side. We’ve been working on the flotation tanks and testing and flooding those tanks. Everything’s going well. We have an engineering company coming in shortly to check the tailing pond liner all in preparation for commencing operations.
We’ve actually done some initial scoping on bringing the gold down from Fran to the Bishop Mill and that looks ok. We thought logistics might be a problem but with the price of gold where it is, any decent grade can travel. The Bishop Mill is ramping up and it looks like we now have some gold to process. As I mentioned, we are aggressive with our acquisitions and we will be announcing additional gold mines and gold projects to add tonnage to the mill along with ounces in the ground.
Quotes have been edited for clarity and style