Gowest Gold has signed an agreement to sell gold concentrate produced from its Timmins-area Bradshaw deposit to Shandong Humon Smelting of China.
The company announced the deal in a Feb. 14 news release, saying it had received a pre-payment of US$3 million.
The gold concentrate will be produced as part of Gowest’s ongoing advanced exploration and bulk sample program at Bradshaw.
“We are extremely pleased to receive the support of such a significant and well-established Chinese company in what is the beginning of a long-term, working relationship,” said Greg Romain, Gowest’s president and CEO, in the release.
“Also, as a second source of financial support, this agreement provides further validation of what we have achieved to date as well as the potential of Gowest’s assets.”
Gowest said it expects to send the first shipment of concentrate to the Humon shelter in the second quarter of 2018. Gowest has until June 30, 2019 to fulfill the terms of the deal.
Humon is a publicly listed company on the Shenzen Stock Exchange with a market capitalization of US$1.6 billion. As one of the world’s largest smelting companies, Humon reports an annual production capacity of 40 tons of gold, 600 tons of silver, 150,000 tons of copper cathodes, 100,000 tons of refined lead, and 1,000,000 tons of sulfuric acid, as well as other metals and chemicals. Humon’s clients include many of the largest mining companies in the world.
Bradshaw is located 32 kilometres northeast of Timmins. The deposit contains approximately 422,000 ounces of gold in the indicated category (2.1 million t at a grade of 6.2 g/t Au) and inferred resources of 755,000 ounces gold in the inferred category (3.6 million t at a grade of 6.5 g/t Au) (3 g/t Au cut-off). This deposit is open along strike and at depth.
At Bradshaw, Gowest has completed more than 1,600 metres of underground development and 14,000 tonnes of development material has been stockpiled on surface for sorting, milling and sale as concentrate.
Construction of the ore sorter bulding is underway and commissioning is expected late in the first quarter of 2018.
The first gold revenue from Bradshaw is expected in the second quarter of 2018.
