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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 17, 1997
GOLDEN STAR RESOURCES LTD.
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(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Canada 000-21708 980101955
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(State or other jurisdiction of (Commission File Number) (IRS Employer
of incorporation) Identification No.)
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1660 Lincoln Street, Suite 3000
Denver, Colorado 80264
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(Address of principal executive offices) (zip code)
303-830-9000
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Registrant's telephone number, including area code:
One Norwest Center, 1700 Lincoln Street, Suite 1950
Denver, Colorado 80203
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(Former name or FORMER ADDRESS, if changed since last report)
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ITEM 5. OTHER EVENTS
RECENT DEVELOPMENTS
On April 17, 1997, Golden Star Resources Ltd. (the "Company") announced core
drilling results for the Andorinhas gold project in the State of Para, Brazil.
Core drilling completed since the last report on January 29, 1997, totaled
approximately 4,060 meters in 14 holes, MAF-51 to MAF-64. Significant
mineralized intersections of the Melechete zone were encountered in 11 of the 14
holes. Six of nine step out holes, drilled to extend the down-dip limits of the
Melechete/Matinha zone, intercepted significant mineralization exhibiting a
weighted average grade of approximately 11.3 g Au/t over an average thickness of
approximately 4.3 meters.
On May 5, 1997, the Company announced the closing of an offering of 3,025,000
common shares of Golden Star at US$7.50 per share for total proceeds before
expenses of US$22,687,500.
On May 8, 1997, the Company and Cambior Inc. announced an increase in estimated
mining reserves at the Gross Rosebel project in Suriname. Proven and probable
mining reserves at Gross Rosebel are in excess of 35 million tonnes grading 1.6
g Au/t, representing approximately 1.8 million ounces of gold in situ, a 32%
increase over the September 1996 estimate of approximately 30 million tonnes
grading 1.5 g Au/t. The reserve calculation was based on a gold price of
US$400/oz.
On May 14, 1997, the Company and its then approximately 58% owned, public
subsidiary Pan African Resources Corporation ("PARC") announced an exploration
update on the continuing evaluation of the 1,300 square kilometer Ndori
property in Kenya. 1,257 of the proposed 1,500 termite mound samples were
collected defining two significant areas of interest. The first of the two
target areas defined is located in the south western portion of the Ndori
property and encompasses approximately 150 square kilometers near the former
Kidston and Ngiga mines. In this area, a zone of quartz stock work was
identified over 1 kilometer long and up to 80 meters wide with grab samples
consistently assaying over 1.0 g Au/t up to a maximum of 4.5 g Au/t. The
second of the two target areas is located in the north central portion of the
property near the village of Barding, encompassing an area of approximately 30
square kilometers of samples. PARC's geologic mapping and grab sampling has
identified an intrusive diorite that hosts a quartz stock work, with altered
intrusive rock where samples have been grading up to a maximum of 12.0 g Au/t
and stock work grading up to 40.0 g Au/t.
On June 30, 1997, the Company announced the conversion of a loan from the
Company to PARC of US$2.0 million plus accrued interest of US$18,591 into
7,333,328 common shares of PARC increasing the Company's ownership in PARC from
58.2% to 63.9%.
On July 1, 1997, Jean-Pierre Lefebvre resigned as a director of the Company.
On July 16, 1997, the Company and its approximately 68% owned public
subsidiary, Guyanor Ressources S.A. ("Guyanor") announced core drilling results
from the contiguous St-Elie and Dieu-Merci projects in French Guiana. On the
Dieu-Merci project, 20 holes totaling 3,049 meters, were completed on the
Kerouani and Virgile prospects. At both Kerouani and Virgile 10 holes were
drilled to test the depth potential of near surface gold mineralization over
areas approximately 300 by 250 meters each. At Kerouani, significant
mineralization was encountered in each of the 10 holes (DM97-01 to DM97-10)
through the saprolite profile and into hardrock, yielding an average
mineralized interval of approximately six meters with a weighted average gold
grade of 2.0 g/t. At Virgile, significant mineralization was encountered in
70% of the holes drilled (DM97-11 to DM97-20), yielding an average mineralized
interval of approximately five meters with a weighted average gold grade of 2.2
g/t. At Michel, a 16 hole infill core
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drilling campaign totaling 2,124 meters was completed to confirm and extend
gold mineralization discovered in 1996. Significant gold mineralization was
encountered in 11 of the 12 holes for which results are available, yielding an
average mineralized interval of approximately 14 meters with a weighted average
gold grade of 2.8 g/t.
On July 25, 1997, the Company together with Guyanor, Cambior Inc. and Cambiex
Exploration Inc. announced estimated mineralized inventory at the Yaou and
Dorlin projects in French Guiana of approximately 35 million tonnes grading 1.6
g Au/t, including 18.2 million tonnes grading 2.0 g Au/t at Yaou and 16.8
million tonnes grading 1.2 g Au/t at Dorlin. Cambior Inc. also reported that it
had adopted a new policy of not reporting probable reserves until a
prefeasibility study has been completed at the two projects.
On August 13, 1997, the Company announced that, in response to continuing weak
gold prices, management had implemented a program for the second half of 1997
to conserve cash by reducing administrative expenses and exploration spending.
As of June 30, 1997, the Company had approximately $29 million in cash. The
revised budgets anticipate total net cash outflow of approximately $1.5 million
per month. These net expenditures are after anticipated joint venture
contributions to the Company's projects of approximately $7.8 million for the
second half of 1997. Management has assessed and prioritized exploration
projects in order to ensure continued progress on the most promising projects
in the Company's portfolio over a prolonged period of time should the currently
weak gold environment persist. The objective of the revised budgets is to fund
those programs that the Company believes offer the greatest potential for
meaningful results and that will generate new resources and reserves. As a
result of management's assessment of project priorities, primary exploration
efforts for the remainder of 1997 are focused on advanced stage projects and
higher priority earlier stage projects including the following six projects:
Andorinhas in Brazil, Yaou, Dorlin, St-Elie and Paul-Isnard in French Guiana,
and Eagle Mountain in Guyana.
Andorinhas is the largest single program in the Company's budget with $5.3
million previously budgeted for 1997. The new budget for Andorinhas for the
second half of 1997 has been reduced by 25%, bringing total projected spending
at the project to $4.7 million for the year. The reduced spending results
primarily from less drilling (500 meters), no trenching, and reduced personnel
and camp costs. Work will continue on the scoping study by independent
consultants to determine the preliminary technical and economic parameters
necessary for mine development.
The new 1997 budget for the Yaou and Dorlin projects has been revised to $5.5
million from $5.4 million. Based on this budget, Guyanor's share of
expenditures will be approximately $1.1 million, with contributions anticipated
to begin in September as soon as Cambior Inc. meets its $11.0 million spending
commitment pursuant to the option agreement between Guyanor, the Company and
Cambior Inc. Diamond drilling at Dorlin is planned to increase to 10,000 m on
50 m centers using two drills to enable estimation of reserves in the Nivre East
and West zones and preparation of a pre-feasibility study. Drilling is also
planned to test the continuity at depth of the two intrusive targets to the
north and west of the Nivre system. Funds are also budgeted for deep augering
to enable definition of a surficial gold resource.
A program of soil geochemistry, geologic mapping, deep augering, trenching and
diamond drilling is planned for the St-Elie and Dieu-Merci projects in the
second half of 1997. A total of 6,500 m of core drilling is planned with 3,000
m focused on the Michel zone and 2,000 m on 3 to 4 additional St-Elie targets. A
total of 1,500 m of core drilling is also planned on the Cesar and Devis-Sud
targets at Dieu Merci. The second half 1997 budget for the combined
St-Elie/Dieu Merci project is US$2.5 million, all of which is expected to be
funded by ASARCO.
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During the first half of 1997, work was again initiated on the Eagle Mountain
project, located approximately 35 kilometers southeast of the Omai mine in
Guyana. This work included the compilation of extensive deep augering
conducted previously by the Company, which defined a significant gold anomaly
(greater than 0.5 g Au/t) over an area approximately 800 by 1,600 meters.
Trenching over the anomaly, totaling 752 meters in 15 trenches, yielded
encouraging results leading to the decision to continue funding the program. A
budget of $500,000 has been approved for continuing exploration at Eagle
Mountain for the remainder of 1997. This budget anticipates the completion of
approximately 2,000 meters of core drilling to test the continuity of
mineralization at depth over the existing anomaly as well as additional deep
augering to identify potential lateral extensions of the existing anomaly.
Construction of the Gross Rosebel project in Suriname has been deferred pending
receipt of the necessary government approvals, resolution of certain issues
related to development and improved gold prices. Work will continue to update
the feasibility study during the second half of 1997. The revised budget for
the second half of 1997 at Gross Rosebel is $2.05 million of which 50% or $1.03
million is the Company's share. This amount includes $576,000 for continuing
engineering and $180,000 for equipment already ordered. The Company's
previously budgeted 1997 construction expenditures of $5.74 million for Gross
Rosebel have been deferred.
Work is also expected to continue on gold anomalies established through the
Company's joint ventures with BHP in Suriname and Guyana, as well as programs
recently initiated on the Dachine diamond project in French Guiana and the Five
Stars diamond projects in north western Guyana. Most other earlier stage
projects have been put on care and maintenance while awaiting improved market
conditions.
Guyanor announced on August 20, 1997 that 10 core holes were completed at the
Paul-Isnard project in May and June 1997, totaling 1,995 meters. Nine of the ten
holes intersected significant gold mineralization exhibiting a weighted average
grade of 2.0 g Au/t over an average mineralized interval of 6.0 meters. These
holes, drilled on wide spacings of 200 to 400 meters, confirmed east and west
extensions of the sulfide-rich, felsic volcanic unit discovered through core
drilling in 1996. To date, significant mineralization has been encountered in
core holes over a strike length of approximately 2.4 kilometers with varying
widths from 200 to 400 meters. Gold mineralization is associated with
sulfide-rich zones, primarily pyrite, pyrrhotite, chalcopyrite and locally
arsenopyrite. Polymetallic assays were conducted selectively on 71 samples from
the second phase of core drilling. Copper values were recorded in 80% of the
samples yielding a weighted average grade of 0.11% copper. Silver values were
recorded in all of the samples yielding a weighted average grade of 4.1 g Ag/t.
Trace values of chrome, magnesium, and zinc were also reported in all the
samples. The budget for the second half of 1997 for Paul-Isnard/Eau-Blanche is
approximately $1.2 million, funded by ASARCO. A third phase drilling program
involving 4,000 to 5,000 meters is being designed to test the continuity of the
mineralized trend discovered in the first two phases of core drilling. Infill
drilling is planned over the known 2.4 kilometer strike length of the sulfide
rich felsic volcanic unit at Montagne d'Or. In addition, core-drilling will be
conducted to the east of the known mineralization to test the possible strike
extension of the Montagne d'Or target.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GOLDEN STAR RESOURCES LTD.
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Registrant
Date September 23, 1997 /s/ Gordon J. Bell
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Gordon J. Bell
Vice President and Chief Financial
Officer
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