Gold-Ore Acquires 90% of Nearby Norrliden Mine

Gold-Ore Resources announced an agreement this week to purchase a 90% interest in a near-term production, poly-metallic deposit (650 hectares) in Norrliden 45 kilometers from the Bjorkdal mine.

Gold-Ore is paying three million shares for the 90% interest in Norrliden. Gold-Ore will also be the operator of the mine. Upon a decision to go into production--which seems likely to happen quickly--Gold-Ore will pay C$2.5 million and issue C$2.0 million worth of Gold-Ore shares.

The remaining 10% ownership is by IGE Nordic, a Stockholm-based public company with a well-funded exploration company with additional polymetallic prospects in Norway and Sweden.

I like this deal for four reasons.

First, it provides large and measured resources that can be brought to production very quickly due to 63,000 available ore and existing infrastructure. Bulk sampling will commence this summer.

Second, it establishes a partnership that Gold-Ore can build on for future projects in Sweden.

Third, Gold-Ore is the operator retaining control over setting milestones and operations.

Fourth, this is a very significant resource. By my calculation, this resource include measured and indicated 3 million ounces of gold, 240 million ounces of silver not to mention large zinc and copper offsets to the cost of production.

The buy-in for this seems reasonable given what is already known and the potential of the Norrliden resource. IMHO, Gold-Ore management has added value for existing shareholders.

Best,

Gold Stock Strategist
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Full disclosure: I own shares in Gold-Ore Resources. The information provided in this post is believed to be correct, but not guaranteed. Investing in junior gold miners entails risks. Readers are responsible for their own investment decisions. Do your own due diligence.