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 announces board shake up
Former board members Brad Marchant, Wade Nesmith, Robert Rusko, and Russell Cranswick resigned on September 9.
The Vancouver-based company also appointed three new board directors, and also expects to add more names to the list in the coming weeks, as it seeks to advance its core mine projects.
The new board directors are: George Stevens, an expert in resource law; Lorne Anderson, who is a chartered accountant; and David Kwong, chief financial officer of Selwyn.
Shares rose 6.67 per cent to hit eight cents on the TSX Venture Exchange Monday early afternoon.
Last week, the zinc and lead explorer suspended its strategic review process, saying it failed to identify a deal acceptable to the board amid the current economic environment.
Selwyn launched a strategic review in April due to its limited financial resources to bring the Selwyn project to completion.
The process focused on engaging Chihong Canada Mining, Selwyn's joint venture partner on the Selwyn project in the Yukon. Those negotiations, which were initially positive, Selwyn said, did not result in "an acceptable purchase agreement."
Selwyn's focus is the exploration and development of the Selwyn project in eastern Yukon and Northwest Territories.
It represents one of the largest undeveloped resources of zinc and lead in the world, noted the company.
The miner is also advancing the ScoZinc mine project in Nova Scotia. Last month, the company updated its mineral resource estimate for the Gays River deposit at the ScoZinc mine, increasing measured resources by 55 per cent.
The Gays River deposit includes the main and northeast zones of the ScoZinc mine, a past producing zinc-lead mine, which the company acquired for $10 million in 2011.
Highlights from the updated estimate include an increase of 55 per cent to the base case measured mineral resources, now measured at 2.07 million tonnes grading 3.14 per cent zinc and 1.68 per cent lead.