Newrange in deal to sell Colombian assets

Newrange Gold Corp. [NRG-TSXV; NRGOF-OTCQB; X6C-FSE] said Wednesday June 5 that it has negotiated a non-binding agreement to sell its wholly-owned Colombian subsidiary together with its El Dovio and Anori exploration projects in Colombia to privately-owned Australian company Andean Mining Corp. Pty. Ltd.

Newrange said the deal does not include a third project – the Yarumalito gold-porphyry property – which the company said it will retain for the time being.

Subject to due diligence, Andean will pay Newrange US$1 million in staged payments within nine months, together with certain other considerations.

“This agreement provides non-dilutive financing, allows Newrange to focus its resources on the company’s highly prospective Pamlico gold project in Nevada, eliminates the costs of maintaining the Colombian subsidiary and projects, and maintains exposure to the upside in each of these projects through share ownership and retained production royalties,” said Newrange Chairman Robert Carrington.

Newrange shares were unchanged at 13 cents on Wednesday and trade in a 52-week range of $0.07 and 25 cents.

In October 2018, Newrange said it entered into a joint venture deal with Andean Mining, giving the Australian company the option to earn a 65% stake in the El Dovio Project in return for cash and share payments plus exploration work commitments.

The property covers high-grade polymetallic gold-silver-copper-zinc mineralization in a belt of marine volcano-sedimentary rocks known to host other polymetallic and volcanogenic massive sulfide (VMS) prospects and mines. Newrange has said exploration at El Dovio indicates significant potential to discover deposits with high unit value and low metal price sensitivity.

The 100%-owned Yarumalito Project covers 1,456 hectares of a large dominant porphyry complex composed of multiple intrusive centers. It is located 11 air-km north of the famed Marmato District, along with what is commonly termed the “Mid Cauca Belt,” a segment of the Andean Porphyry Belt that stretches through Peru, Ecuador, Colombia and Panama.

Exploration work to date has consisted of property-wide geochemical and geophysical surveys, extensive geological mapping and more than 18,000 metres of diamond drilling. This work has defined a large mineralized zone measuring over 400 metres wide, 1,000 metres in length and open to a depth below 385 metres.

Newrange was focused on gold exploration in Colombia until the opportunity came up in 2016 to acquire the Pamlico property, which is located in one of Nevada’s historic gold districts, not far from the famous Comstock Lode.

Carrington grasped the opportunity because he believed Pamlico offered his company the chance to explore and develop a district-scale, near surface, potentially high-grade gold deposit in multiple target areas.

Under a July 2016, agreement Newrange obtained the option to purchase a 100% interest in the Pamlico property. At that time, only 103 shallow holes had been drilled in the entire property.

Exploration to date has been insufficient to define a mineral resource that would meet NI 43-101 standards of disclosure; however, Carrington believes that could soon change if Newrange can complete enough drilling to produce a gold resource estimate.