This morning Select Sands Corp. (SNS.V) announced that they have entered into a letter of intent in respect to a proposed purchase by Comstock Metals (CSL.V) of Select Sands’ Preview SW gold project located in the La Ronge district of Saskatchewan and Select Sands’ early-stage Old Cabin property in Ontario.
Comstock President and CEO, David Terry commented on the proposed acquisition:
“We believe that this acquisition will be accretive to Comstock and will diversify its asset base within mining-friendly Canadian jurisdictions. The Preview SW gold project has excellent potential for resource expansion and further discoveries”
The disposition of non-core gold assets was cheered by SNS shareholders today with SNS shares up 20% on heavy volume:
SNS.V (Daily)
A breakout above .32 would complete a multi-month bottom for SNS and target an upside move to the mid-.40s.
At today’s closing prices the transaction is valued at C$4.6 million for SNS which is quite accretive given that the transaction is a disposition of non-core gold assets and helps SNS to focus on its core business of advancing its Sandtown silica sands project in Arkansas to commercial production. The pending transaction however, still allows SNS shareholders to participate in future upside from a booming gold market, and a multi-asset gold exploration company.
Select Sands President & CEO Rasool Mohammad commented:
“Select Sands is now well leveraged to the two gold jurisdictions, where major mining companies have bought gold ounces: Gold Corp’s acquisition of Kaminak, where Comstock’s QV project is the next discovery after Kaminak’s, and Silver Standards Resources’ acquisition of Claude Resources, where Select Sands’ La Ronge gold property sits optioned to Comstock.”
Disclaimer:
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