Slumbering New Zealand gold deposit to be re-awakenedA large...

Slumbering New Zealand gold deposit to be re-awakened
A large gold discovery near the top end of New Zealand's South Island is to be brought back to life by the man who acquired it about 20 years ago from Rio Tinto

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Miles Kennedy has been working for several months to farm-in on the Sams Creek gold deposit near Takaka from owner OceanaGold Corporation (ASX, NZX & TSX: OGC).

Kennedy, who is chairman of MOD Resources Ltd (ASX: MOD), announced today it had secured the right to earn an 80% stake in Sams Creek, a project he picked up in 1991 for Macraes Mining Co along with Rio Tinto's Reefton goldfield properties to the south.

He had earlier steered the listing of Macraes Mining after it and associated companies purchased the Macraes Flat leases, north of Dunedin, from BHP, and he remained with Macraes until 1993 when he left the company which changed to GRD Resources and later to OceanaGold Corporation.

Early this year a group of prominent media and business identities in Australia put funds in MOD Resources to allow it to change from an industrial company to a mineral explorer

Its first acquisition was a copper project in Botswana.

Sams Creek was actively explored for a few years but when OceanaGold evolved the emphasis outside of the Macraes mining operations was on developing the Globe-Progress open cut mine in Reefton

Before it went into mothballs the gold resource at Sams Creek was expanded to 770,000 ounces.

MOD can earn its 80% interest by funding all exploration and additionally give OceanaGold either 10 million or 17 million shares, valued at respectively $A1.6 M or $A2.72 M; depending on exploration outcomes.

Kennedy said a $A1.9 M drilling programme was scheduled to begin next month,
incorporated with an aeromagnetic survey and a high resolution topographic survey.

"There is obvious scope for an increase in the [estimated] resource, both within the main zone prospect, where the existing 77,000 oz resource has been defined, and the various other targets along 6 kilometres of strike," Kennedy said