BRISBANE(BullionStreet): Pacific Niugini (ASX: PNR) has completed the due diligence and is proceeding with the acquisition of the Caldera Gold project in Mexico.
During the due diligence Pacific Niugini utilised its engineering capacity to construct a purpose built bulk sampling plant for the project.
The plant is similar to that already deployed in Papua New Guinea, but has subtle modifications specifically engineered for feed material from the Caldera Project.
The plant has been booked for shipping and is due to land at the port of Manzanillo, Mexico on the 4th of April 2013 and is likely to be commissioned shortley thereafter. Under the terms of the MoU, Pacific Niugini will design and implement a vigourous testing of the project for gold distribution and gravity gold recovery.
Once it establishes that the project is economic. it will fund the project to production at its cost and will receive 85% of the proftis untill all capital expenditure is repoaid; 70% of profits for the subsequent 50,000 gold proudced and ultimately 50% of profits for the remainder of the life of mine.
The company remains focused on transitioning to production in the shortest possible time, and is well positioned to do so following a successful testing campaign.
It had cash on hand of $7.5 million at the end of last quarter.
Courtesy: Proactive Investors
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