Las Vegas company announces deal to buy gold mines
HELENA, Mont. -- A Las Vegas-based company has announced a $350 million deal to purchase two gold mines in southwestern Montana.
Consolidation Services Inc. stated on its website Monday that a wholly owned subsidiary, CSI Resources Inc., has entered a stock purchase agreement to acquire Elkhorn Goldfields Inc. and Montana Tunnels Mining Inc. in Jefferson County from Elkhorn Goldfields LLC, based in Vancouver, British Columbia.
The transaction should be completed within 45 to 60 days but is subject to due diligence, shareholder approval, closing conditions and third-party financing of $7.5 million, Consolidation Services President Gary Kucher said in a statement.
The statement said production from the Golden Dream deposit at Elkhorn is expected to average 60,000 ounces of gold per year at full production, while Montana Tunnels could average about 100,000 ounces per year. At today's gold prices, the estimated total is about $235 million per year. The gold would be processed at Montana Tunnels, which shut down in April 2009.
Consolidation Services said the Golden Dream deposit contains 260,000 ounces of gold and 8.5 million pounds of copper.
Consolidation Services is publicly traded over the counter. It reported a $13 million loss in 2010 from its oil and natural gas projects in Kentucky and Tennessee.
