Galantas sells call options on N. Ireland gold production
Galantas Gold Corp. [GAL-TSXV, AIM, GALKF-OTCQX], the company that has developed the Omagh Gold Project in Northern Ireland, said it has entered into a trading agreement with Ocean Partners UK Ltd.
Under the agreement, Ocean has sold on behalf of Galantas call options on 6,000 ounces of gold at a rate of 500 ounces per month from February, 2024 to January, 2025 at a strike price of US$1,775 per ounce, generating proceeds of US$804,000 to Galantas (an option premium of US$134 an ounce).
Galantas said proceeds of the sale will be used to fund development of the underground mining operations at the Omagh gold project.
On December 8, 2022, Galantas shares closed at 56 cents. The shares are currently trading in a 52-week range of 75 cents and 36 cents.
Galantas said Ocean is a person closely associated with Brent Omland, a director of Galantas and chief financial officer of Ocean. He is Ocean’s nominee on the Galantas board.
“We are grateful for the long-standing support of our shareholders who see the district-scale and high-grade potential of the Omagh gold project, and particularly Ocean for allowing Galantas to utilize its trading platform and credit lines that are not typically available to junior producers,” said Galantas CEO Mario Stifano. The sale of the call options represents approximately 1.0% of our resource base, resulting in a strengthened balance sheet as we work towards production ramp up in 2023,’’ he said.
The Omagh project is situated within an 189 square-kilometre licence area, located approximately 1.5 hours drive west of Belfast. The project is also situated west of the town of Omagh, the main administrative centre in County Tyrone. Galantas currently holds five exploration licences, covering an area of 548.9 square kilometres.
Galantas, through a wholly-owned subsidiary, owns the freehold title to over 220 acres of land, upon which the initial open-pit mine, processing plant, tailings facility and water clarification ponds are situated. The mine is now in the development stage with more than 2,000-metres of ore and waste development completed.
Resources in the measured category stand at 138,241 tonnes of 7.25 g/t gold or 32,202 ounces. On top of that is an indicated resource of 679,992 tonnes of grade 6.78 g/t or 147,784 ounces of gold. In addition, the project is estimated to contain 1.37 million tonnes of 7.71 g/t or 341,123 ounces of inferred material.
Vein-hosted gold is found within the Dalradian meta-sedimentary rocks on the project’s primary license area. The steeply dipping quartz veins are orientated north-south and host sulphide minerals, including abundant pyrite and galena.
In an update earlier this year, the company said it has made significant progress in rehabilitating the underground workings, refurbishing and acquiring critical mining equipment, and installation of electrical water, and ventilation systems.
However, the company said it has faced a tight labour market for experienced underground miners.