Vancouver-based Golden Dawn Minerals Inc. (TSX-V:GOM) announced this morning it has signed a letter of intent with Peruvian underground mining contractor Lichtfield del Peru S.A.C. to develop the historic May Mac gold-silver mine at Golden Dawn’s Boundary Falls property.
The deal would see Lichtfield fund the exploration and development of the mine, contributing up to $1.8 million, in return for a 50% interest in the Boundary Falls property on which the mine is located.
The Boundary Falls property is three kilometres from the town of Greenwood, B.C.
Golden Dawn CEO Wolf Wiese told Business in Vancouver that the deal responds to an expertise gap in Canada that Lichfield would fill with its own employees.
“We just don’t have the qualified underground miners here in Canada anymore,” he said. “There’s hardly any narrow-vein, high-grade underground mines operating, and all of the miners that are available are all in their 60s and 70s.”
Wiese added that the deal would see Lichtfield “unlock” a “dormant” asset for Golden Dawn.
“This would unlock this asset and hopefully create cash flow for the company, and the company is not diluting itself through shares; it’s diluting one small portion of its property up there.”
From Lichtfield’s perspective, Wiese said the project is an opportunity to break into the North American contract mining market.
“They’re very active in Peru and this is an opportunity for them to establish themselves as contractors in North America and at the same time make some money,” he said. “So they would come in and prove to everybody that they’re good underground miners – and there are many, many opportunities here in Canada and North America where there are dormant underground mines that are not being mined because of the lack of experienced miners.”
At press time, Golden Dawn’s stock was up just under 6% to $0.090.
Jenny Wagler
Twitter: JennyWagler_BIV