Selwyn has entered into a sale transaction with Chihong Canada Mining Ltd. to sell its 50% interest in Selwyn joint venture project in Yukon and Northwest territories, for CAD 50.0 Million. The transaction was approved by the Selwyn shareholders at the April 22, 2013 Special Meeting and is expected to be closed in early June 2013 together with the payment of the remaining CAD 40.0 Million.
Selwyn acquired ScoZinc Ltd in 2011 for CAD 10.0 Million and with a plan to re-start operation and join the “Producer group”. The time required to resume production at ScoZinc is approximately 9 months, with an estimated production of 2,500 tpd (Zinc and Lead) mine and mill operations. The Selwyn Board has indicated that it wishes to have the funds from the sale of its interest in the Selwyn Project to fund the restart of ScoZinc mine if warranted and grow of the company as a new base-precious metal producer.
Selwyn Resources up on initial agreement with Kaska communities in Yukon
Selwyn Resources (CVE:SWN) said Thursday it has inked an interim agreement with Ross River Dena Council and the Liard First Nation on behalf of all Kaska communities, in an effort to establish a relationship as it advances its flagship project in the Yukon.
The Kaska First Nation communities in the Yukon include Daylu Dena Council, Kwadacha, and Dease River First Nation.
The Selwyn project in the Yukon is being developed by Selwyn Chihong Mining, the joint venture company formed by Selwyn and Chihong Canada Mining in August 2010 to develop the property.
The project is located in eastern Yukon, straddling the border with the Northwest Territories.
"Selwyn Chihong is encouraged by this significant step forward in our relationship with the Kaska," said Selwyn’s vice president of environment and community affairs, Justin Himmelright.
"The Interim Measures Agreement establishes the framework for SCML and the Kaska to work to advance the project through final feasibility, permitting, and into construction.”
Selwyn said that it expects to begin negotiations of a socio-economic participation agreement very soon, which will help guide their relationship for the operations phase of the project - adressing environmental and social concerns as well as Kaska involvement opportunities.
"This Interim Measures Agreement is an important first step in terms of the relationship," said the Liard First Nation Chief, Liard McMillan.
"It governs how the Kaska will be engaged during the exploration and feasibility discovery phase of the Project."
In January 2007, Selwyn completed a preliminary economic assessment (PEA) for the Yukon project, which considered an open pit plan of mining at 20,000 tonnes per day.
Since the initial PEA was prepared, however, there have been significant movements in exchange rates, as well as in metal prices and capital and operating cost assumptions, rendering the PEA no longer viable.
Earlier in May, Selwyn announced an updated mineral resource estimate for its XY West deposit at the project, highlighting the expansion of its inferred category resources to 12.75 million tonnes grading 4.42% zinc and 1.40% lead.
The updated NI 43-101 report included drill results from the 2010 and 2011 definition drilling and exploration work programs at the XY West deposit.
Selwyn noted that the XY West deposit is a key component due to its close proximity to the adjacent XY Central deposit, which has an inferred mineral resource of 44.11 million tonnes grading 4.10% zinc and 1.29% lead.
The updated 12.75 million tonne inferred estimate for XY West used a base case 2.0% zinc cut-off grade, and includes 3.27 million tonnes of higher grade zinc-lead mineralization grading 7.71% zinc and 2.23% lead at a 5% zinc cut-off grade.
Since acquiring the Selwyn project in 2005, the company said it has made nine major deposit discoveries that are potentially amenable to open pit and/or underground mining methods, with all of the deposits remaining open for expansion.
The total indicated mineral resources at the Selwyn project are 180.69 million tonnes grading 5.25% zinc and 1.83% lead for a metal content of 20.91 billion pounds of zinc and 7.30 billion pounds of lead.
The inferred mineral resources have increased to 226.88 million tonnes grading 4.44% zinc and 1.37% lead for a metal content of 22.23 billion pounds of zinc and 6.84 billion pounds of lead.
Selwyn also released additional drill results from the Don Connector target at its Selwyn project in May, including hole DON-233, which intersected 27.85 metres true thickness, grading 6.09% zinc and 1.87% lead, including 10.87 metres grading 8.95% zinc and 2.62% lead.
Shares of Selwyn increased 5.88 per cent to 9 cents Thursday afternoon.