Greenwood mining projects change hands
Huakan International Mining Inc. announced Tuesday that it has entered into an asset purchase agreement with Gold Crown LLC , an arm’s length company, to sell 100 percent of its interest in the Greenwood Gold Project located near Greenwood, B.C. for $5,000,000 and a 2 percent net smelter returns royalty on any ore milled at the Greenwood mill, up to a maximum of $9,000,000 over a 10-year period.
The Greenwood Gold Project is comprised of the 200 tonne per day Greenwood mill, and the Lexington-Grenoble, Golden Crown, and Lone Star gold/copper properties. Gold Crown has also agreed to make minimum net smelter royalty payments of $500,000 per year, and to make a lump sum payment at the end of the 10 year period, if necessary, to bring the total net smelter royalty payments made to $9,000,000. The proposed transaction is scheduled to close on or around May 25, 2011.
Deli Tian, acting president and chief executive officer, states, “All of the stakeholders in the Greenwood Gold Project, including local and regional businesses, communities, and governments, and First Nations will benefit from Gold Crown’s intended re-opening of operations this year.”
The sale of the Greenwood Gold Project assets will enable the Huakan to focus its resources on continuing to advance its 100% owned J&L polymetallic (gold/silver/lead/zinc) project located near Revelstoke, BC.
The completion of the proposed transaction is conditional upon, among other things, approval by Huakan’s shareholders, which will be sought at the company’s annual and special meeting of shareholders to be held on or around May 12, and approval by the TSX Venture Exchange.
This mining project was previously run by Merit Mining Inc. and has been dormant for over a year.