Tuesday, 5 February 2013

St. Elias Mines slows operations at Tesoro after failing to secure funds


St. Elias Mines (CVE:SLI) has scaled down its exploration program at its Tesoro gold project in southern Peru, saying it was unsuccessful in raising funds. 
As a result, the company has to slow down operations at Tesoro and has shut down most exploration activity, except for the completion of a NI 43-101 resource calculation, care and maintenance activities and some permitting. 
The company will also have a "skeleton watchman team" in place, and will pursue environmental impact study permitting for additonal drilling and the exploitation of development material. 
Last Wednesday, St. Elias withdrew the up to $10 million non-brokered private placement financing it initially announced last October. 
Its Tesoro gold project is 100 per cent owned by the company with no underlying royalties.  The property covers around 6,974 hectares and lies within the 300 km by 30 km Nazca-Ocona gold province, which trends northwest parallel to the Pacific coastline.  
While the veins are often narrow with less than one metre, their gold grades can be high, St. Elias noted, especially in localized "shoots" that occur.
The company previously had planned a two-party strategy over 18 to 24 months to advance Tesoro, including up to a 5,000 metre drilling campaign, which was contingent on financing.

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