During the September month of last year, via a share exchange agreement, Norman Cay Development acquired all outstanding shares of Discovery Gold Ghana Limited for a $100k lump sum and issuance of 17.5M newly-issued shares to DGG stockholders. The company thereby obtained access to the exclusive option held by DGG with rights to acquire, explore, and develop the Edum Banso (7.8 square miles) gold project in Western Ghana (specifically the historic Ashanti Gold Belt, Mpohor Wasa East District). DGG currently holds a 65% interest with an opportunity to acquire up to 90% in these exclusive exploration rights.
Norman Cay takes the stage alongside the big boys, like global gold developer Newmont Mining (who now has some 20% of their overall footprint in resource rich Ghana), with a key property that is ideal for such an emerging gold developer. DGG, which is now a wholly-owned subsidiary of NCDL, is organized under the laws of the country of Ghana and so NCDL is already in a very favorable position with regard to the Ghanian government for advancing the highly prospective Edum Banso project.
As of June 13, NCDL has reported receiving approval by the Minerals Commission of Ghana of the assignment of option rights for Edum Banso, clearing the way for future development, as this assignment of the option rights from Xtra-Gold Mining Limited to DGG was the final acquisition agreement obligation to be fulfilled. The option transfer transaction was subject to a nominal fee (already paid and receipt taken) to the Minerals Commission and will produce key, formal Ministerial consent by mid-July 2012, according to the company’s Ghana legal counsel.
NCDL is big on Ghana gold and has devised a regional strategy focused on Edum Banso. Now that the Minerals Commission transfer approval process is completed, an aggressive funding/exploration initiative will be pursued, targeting the previously identified areas. Phase I of the 2012 exploration program will include extensive geological mapping efforts, as well as soil sampling, assay, and the necessary subsequent analysis required in order to validate previous efforts on the concession by both Xtra-Gold (in 2008) and Newmont Gold (2004).
The company will try to line up perfect vectors for Phase II trenching and auger sampling, looking to take full advantage of the well-established profile offered by extant workings. In general the exploration program (outlays projected at some $970k over the next 12-month period) will seek to extend the data sets already assembled via the previous aeromagnetic analysis, as well as some 5,782 soil/stream sediment samples, 319 meters of trenching, 252 auger drill holes, and 81 rock chip samples taken. The goal is to flesh-out the four distinct mineralization zones occurring across the roughly 5 mile by 2k-foot area, which includes contact with the same source behind the nearby (just over half a mile away to the SE) HBB Father Brown and Adoikrom open pit operations (around 180k ounces per year) of Golden Star Resources, the distinct Mpohor Complex mafic intrusions.
This is a great spot to be developing and other nearby producers, like the Adamus Resources/ Endeavour Mining, multi-million ounce Nzema Gold Mine (100k ounces per year), offer a tantalizing indication of the kind of news to potentially look forward to out of the company’s 2012 exploration program at Edum Banso. Needless to say that some 5 mile by 2k-foot mineralization area will provide ample opportunity for Phase II bedrock seeking, and with a known gold geochemical profile, preparations for a 15-30 hole Phase III drilling campaign is expected to go swimmingly.
The company will shrewdly employ the best efforts of their Ghana-experienced technical consulting firm and should have Phase I wrapped within 90 days of kick off. Norman Cay is looking at some very exciting times in the immediate future and has really plowed into the mission, grabbing 30-year veteran of the mining industry Steven E. Flechner for the President and CEO position. The Flechner appointment should tell investors everything they need to know about just how serious NCDL is regarding their Ghana gold strategy. Flechner has extensive management experience throughout the industry, as well as on projects in Ghana and was VP/General Counsel for Gold Fields Mining Company from 1978-1993 (U.S. subsidiary of former giant Consolidated Gold Fields), overseeing massive, 100-fold growth in the company’s personnel base and extensive, 400k ounce/year, highly-profitable mining infrastructure (Ortiz, Mesquite, and Chimney Creek mines) that was later acquired by Newmont Mining.
This is the portrait of a truly assertive emerging gold development company and NCDL is obviously committed to putting the tools and talent into the field to make the CAPEX work for shareholders, so it will be very interesting to see what kind of data comes out of their upcoming exploration program at Edum Banso. With successful open pittable resources being developed in close proximity and a solid geological roadmap that even hits known, producing targets, it should just be a matter of time before we see some serious color.
In a world of increasing uncertainty, where major currencies are under fire from sustained debt pressure, it is easy to see how all roads lead to gold and precious metals as a store of value. Moreover, the intractable nature of sovereign debt crises, has sparked a wave of gold buying by central banks around the world, which are moving to hedge against both general market pullback potential and increased exposure to commodities.
Let us hear your thoughts below: