BRITISH COLUMBIA - NEW GOLD INC. of Vancouver has finally signed a letter of intent with TECK COMINCO to acquire surface rights to the former Afton copper mine near Kamloops. The deal covers almost all of the land to which New Gold has mineral rights, including the New Afton and Pothook zones plus a large tract north to Kamloops Lake. Teck will receive $16 million over two years plus a 2% NSR.
New Gold has been testing the mineralization below the old open pit since 2002, and recently appointed CEMENTATION CANADA as the underground mining contractor for the proposed development. In September 2006, New Gold released new measured and indicated resource numbers. The middle scenario, at a cutoff value of $20/t, was 50.5 million t grading 1.20% Cu, 0.89 g/t Au and 2.87 g/t Ag. The other scenarios are posted at www.NewGoldInc.com in the Sept. 21, 2006 press release. There is also an area of deeper mineralization not included in these numbers.
Work on the feasibility study is nearing completion and should be available by the end of Q1 2007.