Golden Phoenix sells moly mine north of Winnemucca
Golden Phoenix Minerals Inc. plans to sell its interest in a mothballed molybdenum mine north of Winnemucca.
The Sparks company said it expects to sell the property for $5.3 million to Win-Eldrich Mines Ltd., its partner in the Ashdown project.
Win-Eldrich, which initially owned 40 percent interest in the project, will pay for the acquisition with a secured note to be repaid over six years.
The two companies have been locked in a legal battle for more than two years over the exact amounts of ownership in the Ashdown project that each is entitled to receive.
With the sale agreement, Golden Phoenix and Win-Eldrich agree that the legal issues will be resolved. The transaction is scheduled to close by April 1.
Perry Miller, the president of Toronto-based Win-Eldrich, said resolution of the legal issues surrounding the molybdenum mine should help his company win investor capital to move the project forward.
The project has been shut down since November because of falling world prices for molybdenum, a mineral that’s used in stainless steel and other applications.
In 2007, the property’s only full year of production, it sold $10.4 million worth of molybdenum. It’s located near the Idaho state line about 115 miles north of Winnemucca. The mining property covers about nine
Golden Phoenix, meanwhile, now will devote more attention to restarting its Mineral Ridge gold and silver mine 32 miles west of Tonopah in Esmeralda County.
The company operated the mine from 2003 through 2005, but suspended mining because the project wasn’t profitable.
Since then, gold prices have continued to climb. Investors are looking for mining properties such as Mineral Ridge that already have state and federal permits so they can begin production quickly, said David A. Caldwell, the chief executive officer of Golden Phoenix.
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