Omineca Mining and Metals Ltd. (TSXV: OMM) has entered into a binding letter of intent with HMI Mining to develop and operate the Wingdam Placer Gold Project in the Cariboo Mining District of south-central British Columbia, the company announced NEWMEDIAWIRE. Under the agreement, HMI will acquire an undivided 50% ownership interest in the project, making the two companies joint venture partners for development and mining, with HMI serving as onsite operator providing mining and engineering services.
The Wingdam Placer Project is located approximately 26 kilometres west of Osisko Gold Group’s currently under-construction Barkerville Gold Mine. The transaction is subject to acceptance by the TSX Venture Exchange.
In its role as joint venture partner and project contractor, HMI will undertake ongoing permitting, environmental monitoring, regulatory compliance, engineering, and the running of operations, equipment, and site services for the project. Omineca will retain a 50% carried interest through to and after commercial production. HMI has the exclusive right to mine all of the placer gold on the project claims, delivering 50% of all recovered gold to Omineca for a cost of CAD $1,000 per ounce plus an additional CAD $250 per ounce until a five-year mine plan is submitted.
The agreement matters for Omineca because it brings in a partner with specialized expertise while preserving the company’s carried interest. Omineca stated that given the extensive background of HMI’s principals in materials science, ground stabilization, and engineering, management believes HMI is an exceptional partner for the development of the Wingdam project. HMI brings integrated engineering and operations expertise, specializing in advanced materials science supporting specialty products and application equipment manufacturing. The company’s international experience with custom-formulated chemical systems for geotechnical grouting and ground support, together with its patented technologies and specialized design systems, is expected to provide the engineered structural control and mining capabilities required at Wingdam.
The Wingdam property includes mineral tenures totaling 61,392 hectares (613 square kilometres) and in excess of 15 linear kilometres of placer claims, both encompassing the Lightning Creek valley where topographic conditions created thick layers of overburden, which preserved a large portion of a buried paleochannel containing placer gold-bearing gravels. Omineca also has a program exploring for the potential multiple hard rock sources of the placer gold at Wingdam.
For readers and industry observers, the joint venture structure could accelerate development of the Wingdam underground placer program while limiting Omineca’s capital exposure through the carried interest. The involvement of HMI, with its focus on ground stabilization and geotechnical grouting, may also help address the technical challenges of mining in the thick overburden conditions at Lightning Creek. The project’s location near the under-construction Barkerville Gold Mine places it in a region of active gold development in British Columbia.
Omineca’s Fraser Canyon Project, located 12 kilometres northwest of Quesnel, BC, is now slated to reinitiate the development of the underground paleochannel for the recovery of placer gold. Historically, two mines north and south of the Fraser River collectively produced 1,482 ounces of raw placer gold.
