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Tuesday, 25 September 2012
Prodigy Gold acquires almost 24% of Goldstream Minerals
Vancouver-based Prodigy Gold (CVE:PDG) said today it has acquired roughly 10.7 million common shares of Goldstream Minerals (CVE:GSX), formerly Brea Resources, representing a near 24 per cent stake.
Goldstream is a gold exploration and development company whose main property is the Hardrock East project in the Beardmore-Geraldton gold camp of northern Ontario.
The property consists of over 350 square kilometres in the eastern portion of the Beardmore-Geraldton gold camp.
The shares were issued to Prodigy by way of share exchange, in connection with an option agreement between a Goldstream subsidiary and Prodigy from October 2011.
Goldstream exercised its option to acquire certain mineral exploration properties from Prodigy.
As disclosed in Goldstream's filing statement, Prodigy is a party to a "surplus security escrow agreement" with Goldstream and certain other shareholders of the company, under which the shares are held in escrow by a third party and released in stages over the course of 36 months.
Prodigy said five percent of the shares were released from escrow on Friday, adding that shares were acquired for investment purposes and it can increase or decrease its holdings from time to time as appropriate.
Last month, Prodigy Gold released an updated resource estimate at its Magino project in Wawa, Ontario.
Magino now hosts 6.1 million ounces at 0.9 grams per tonne (g/t) gold, which is a 56 per cent increase relative to the company's prior resource estimate at the property of 3.9 million ounces at 1.0 g/t gold.
In addition, 95 per cent of the resource now resides in the measured and indicated category, versus 56 per cent previously.
The new resource also contains a large proportion of gold resources above a grade of 0.50 g/t gold, which the company believes will provide a focus for mill head-grade optimization studies.
Prodigy said the higher grade material will likely support a mine plan that maximizes mill head grade, potentially lowering cash costs per ounce and improving project net present value.
The new resource will be included in a pre-feasibility study for Magino, expected early in 2013. Additional drilling is being planned to finalize the resource block model as part of the the study.