The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.
A little-known junior miner plans to buy and restart the former New Britannia gold mine in Snow Lake, but enthusiasm around the announcement is likely to be tempered by past disappointment. Toronto-based Liberty Mines Inc. plans to purchase the mine from QMX Gold Corp. for US$20 million and reopen it 'as soon as possible.' Liberty and QMX have entered into a binding term sheet. If all goes well, the sale is expected to be completed on or before Nov. 25. In a news release, Liberty said completion of the purchase will bring it 'immediate medium-term growth potential' with a target of 80,000 ounces of gold per year from the property. Already the owner of a gold mill in Timmins, Ontario, Liberty said the Snow Lake purchase would position it 'as a near term gold producer.' Liberty said it expects to re-commence production at the mine based on the results of a 2010 feasibility study commissioned by QMX, then known as Alexis Minerals. No date for the potential reopening was mentioned, but Liberty chair Shu Wu said the plan is to do so 'as soon as possible.' The feasibility study projected an estimated 80,000 ounces of gold per year over five years at an average cost of US$640 per ounce, after an initial capital cost of C$39.7 million over a one-year period. QMX has indicated that bringing the mine back into production could create about 200 jobs _ a major boon to Snow Lake, which is already gearing up for full production at Hudbay's Lalor mine. But Snow Lakers may be reluctant to get too excited. Recent years have brought all talk but little action in terms of restarting the former New Britannia mine, now known as the Snow Lake mine. At one point QMX even announced plans for production to begin in early 2011. See 'Placed' on pg. Continued from pg. As a deposit on the purchase price of US$20 million, Liberty has placed US$1 million into a trust account of its legal counsel. It would be paid to QMX upon the execution of a definitive purchase agreement. The execution of the definitive agreement remains subject to, among other things, Liberty completing a satisfactory review of the property. The remaining purchase price of US$19 million shall be paid upon closing of the transaction, which is expected to occur on or before Nov. 25. In connection with the proposed acquisition, Liberty has appointed David Rigg as its president and CEO. Rigg is the former chairman, president and CEO of QMX. 'We welcome David Rigg to the Liberty Mines management team,' said Wu, the company chairman. 'We plan to re-commence production activities at Snow Lake Property as soon as possible and believe that Mr. Rigg is the person who is best positioned to lead us through that process.' The Snow Lake mine would represent a new direction for Liberty, which says on its website that it 'is focused on the exploration, development and production of nickel and related base metals from its assets in Ontario.' The Snow Lake mine property saw its first production between the mid-1940s and the late 1950s. It closed for more than three decades before reopening in 1995. The mine was shut down again in 2005 and has remained closed ever since. No stock exchange, securities commission or other regulatory authority approved or disapproved information supplied by Liberty.
