(Alliance News) - Hochschild Mining PLC on Friday exercised its option to start earning in to a 60% interest in the Snip gold project located in the Golden Triangle and in Tahltan Territory in British Columbia, Canada.
Snip was acquired by Skeena Resources Ltd from Barrick Gold Corp in the summer of 2017. The former Snip mine produced approximately one million ounces of gold from 1991 until 1999 at an average gold grade of 27.5 grammes per tonne. Skeena started underground drilling in 2017 to explore for additional mineralised shoots in a large shear structure.
A maiden mineral resource was announced in July 2020 including 244,000 ounces of gold in the indicated category at an average grade of 14.0 grammes per tonne and 402,000 ounces of gold in the inferred category at an average grade of 13.3 grammes per tonne.
Chief Executive Ignacio Bustamante said: "We are pleased to exercise our option on the Snip project in Tahltan Territory, Canada. This represents a first step in our strategy to add another high-grade project with strong upside potential into our pipeline. We look forward to working with Skeena and building on their strong relationship with the Tahltan Nation."
In September 2018, Skeena granted Hochschild an option to earn-in a 60% interest in Snip over three years by spending twice the amount Skeena had spent since it originally optioned the property from Barrick.
To date, Skeena estimates that it has incurred approximately CAD50 million, about USD40.5 million, of expenditure on the project.
Hochschild must spend more than CAD7.5 million in exploration or development expenditures on Snip in each year of the option period, and provide 60% of the financial assurance required by governmental authorities for the Snip mining properties.
Shares in Hochschild Mining were 1.5% lower in London on Friday morning at 143.00 pence each.
By Paul McGowan; paulmcgowan@alliancenews.com
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Hochschild (HOC)