LONDON (Alliance News) - Rambler Metals & Mining PLC Monday said it has committed to looking at the possibility of re-opening an old gold mine in Canada after signing an engineering, evaluation and services agreement with the owner of the property, Maritime Resource Corp.
Rambler Metals is an investor in Maritime, holding a 17.5% stake in the Toronto-listed company at the July last year. The pair will look at revitalising the past-producing Hammerdown gold mine that lies in Maritime's Green Bay property which is spread over Newfoundland and Labrador in Canada.
The agreement signed Monday has been a long time in the making as Rambler signed a letter of intent way back in November 2014 stating it was looking at the potential of reopening the Hammerdown mine with Maritime during the first half of 2015.
One of the reasons talks may have progressed recently is because Rambler's gold plant at Nugget Pond in Canada is now under care and maintenance whilst the ore currently being taken from the Ming mine is only being fed to the copper concentrator, rather than gold.
"Fully utilising all available infrastructure at our processing facilities could be a tremendous opportunity for both Rambler and Maritime," said Norman Williams, president and chief executive of Rambler.
Rambler and Maritime plan to appoint an independent third party consultant to assist them with the pre-feasibility study for Hammerdown. Importantly, Maritime will fund that study, which should establish whether the mine is worth reopening in the current market.
If both Rambler and Maritime agree the pre-feasibility study demonstrates Hammerdown can be economic, then they will sign mutually agreeable management services and toll milling agreements advancing work to reopen the operation.
The Hammerdown mine was in production from 2000 until 2004 with grades averaging approximately 16 grammes of gold per tonne and average recoveries in excess of 97%.
Rambler shares were up 7.7% to 3.77 pence per share on Monday.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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