Paramount Mining Corporation (ASX: PCP) is furthering its strategic focus on Indonesian gold, securing a controlling stake in the high grade Gunung Rosa gold, silver and base metal mine project in Indonesia.
The company is focused on the redevelopment of the historical Gunung Rosa Mine, which has potential to become a long term producer of high grade gold and silver, with base metal credits.
Gunung Rosa hosts a JORC Resource of 358,832 ounces of gold and Reserves of 146,700 ounces of gold.
PT Paramindo, an 85%-owned subsidiary of Paramount, now holds a 51% interest in Gunung Rosa, up from its initial 10% interest.
Paramount's move to increase its interest follows a helicopter-borne magnetic survey program which identified at least six new prospective targets.
Company managing director and CEO Terry Holohan said today that the survey backed up results from drilling at the project.
"This survey further confirms our geologist's initial thoughts from the drill data that the existing gold-silver-base metal mesothermal vein system has developed within an intrusive complex and might be associated with a potentially much larger gold-copper porphyry system," Holahan said.
"Our fieldwork has also shown us that the vein system is far more extensive than we initially thought."
Holahan said the results increased the likelihood of the company finding more resources to exploit in the near term, along with adding further upside potential for identifying larger resources in the medium to long term.
Consideration for the second stage of the acquisition of Gunung Rosa was $US2 million, which has been paid to PT Cikondang Kancana Prima (NYSE:CKP).
Paramindo acquired its initial 10% equity interest in the project in March this year, paying US$1 million in staged payments to the vendor.
Under the Stage 2 Payment terms, Paramindo will appoint an additional director and commissioner to the board of CKP. This will bring the number of Paramindo appointees to two of three on each board, including the President Commissioner and President Director.
With the positive helimag results in and a majority interest secured, Paramount's next step at Gunung Rosa will be to refurbish the old operating mine and bring it into production as quickly as possible.
At the same time, the company is focused on further defining a diamond drilling program, with the aim of re-estimating the Mineral Resource and assisting with ongoing larger scale mine development planning.
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