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GOLD IN BOLIVIA
INTRODUCTION
SUN RIVER MINING, INC. offers investors an incredible
ground-floor
investment opportunity in a company that is slated to begin
producing
gold during 1999 at a cash cost of less than US$100 per ounce!
Sun River Mining went public in September and trades on the
NASDAQ OTC
electronic bulletin board under the symbol "SUNR". Sun River
Mining is
tightly-held (insiders hold 7.8 million shares), has a limited
float
(approximately 1.5 million shares) and is not very widely known.
The Company's primary business is the acquisition, exploration
and
development of placer gold projects in Bolivia, with the goal of
becoming
Bolivia's largest and lowest-cost alluvial gold producer. The
management
team has over 60 years of placer mining experience.
THE COMPANY
Sun River Mining, through its Bolivian subsidiary, North Bolivian
Investment S.A. has entered into a Letter of Understanding
Agreement
with Aluvion S.A. and its shareholders to acquire up to an 81%
equity
interest in Aluvion, which is a Bolivian company holding mineral
concessions in the Tipuani River basin. Aluvion management has
extensive dredging experience in alluvial / placer gold prospects
and
owns hydraulic excavation equipment.
The Company has obtained a report on the Tipuani River prospects
of
Aluvion from the respected mining and engineering firm in Denver,
Colorado of Watts, Griffis & McOuat, Limited ("WGM"). The Report
concluded that "there are indeed significant volumes of unmined
uriferous gravels to justify interest in establishing commercial
operations based on these deposits." WGM recommended
additional drilling of prospects for evaluation purposes,
and that negotiations to reduce royalty interests in the
concessions begin.
The company is currently seeking funding sources and / or
oint venture partners to provide capital for the pursuit of the
Aluvion S.A.opportunities. The Letter of Understanding Agreement
requires aggregate payments of $7,189,000 to complete a 74.324%
equity interest acquisition of Aluvion, of which over $400,00 has
been
advanced to Aluvion with $5.57 million due January 31, 1999 and a
further
$1.2 million to be paid out of production. Further, $2.5 million
additional
paid in capital would increase SUNR's equity interest in Aluvion
to 81%.
There are on-going negotiations with several financing sources;
however,
the Company has not received a binding commitment for such funds
at this
time, nor are there guarantees or assurances that such a
financing can be
arranged on terms acceptable to Sun River Mining.
Sun River Mining's Denver-area location allows it to tap into a
wealth of local
technical, financial and operational expertise. Other
Colorado-based firms with
major property positions as well as operating and developing
mines in Bolivia
include: Orvana Resources (developing the Don Mario and Pederson
gold projects),
Granges, Inc. (undertaking feasibility studies on the Capa Circa
and Amayapampa
deposits), and Golden Eagle International.
MANAGEMENT
Among operating companies, a key component of success is the
experience of the
management team.
If Sun River Mining acquires Aluvion S.A., it will have the
benefit of
Gaston Fernandez (currently the President of Aluvion) who has 45
years
of mining experience, mostly in dredging operations in South
America.
Mr. Fernandez was Chief Engineer on the Kaka River dredge
operated
by South America Placers, Inc. from 1957 - 1965, using the same
dredge
that Sun River Mining / Aluvion intends to acquire, refurbish and
use
on the Tipuani & Kaka River projects. His son, Marcelo
Fernandez, is
a mining engineer with over 20 years of placer mining experience
(a graduate
of the Colorado School of Mines), who is employed by Aluvion as
technical
and operations manager for the Lower Tipuani and Kaka River gold
projects.
THE PROSPECTS
Lower Tipuani. The Lower Tipuani prospects cover approximately 8
km along
the Tipuani River between the towns of Guanay and Tipuani. Guanay
is located
105 kilometers north of LaPaz, Bolivia, and is connected with
LaPaz by a 230-km
paved, gravel and dirt road (a new paved road is under
construction).
In the Lower Tipuani area, the river is 30 to 60 meters wide and
up to 10 meters deep.
All of the necessary infrastructure is in place, including a
100-man base camp,
access roads and high voltage hydroelectric power lines.
An environmental impact study has been completed and approved by
the Bolivian government.
The one remaining permit necessary to begin construction, the
"environmental
operating license", takes about 60 days to receive (Aluvion needs
to provide
Bolivian government with information on the equipment to be used
and a schedule
for the exploitation phase).
Planned mining operations would involve dredging, washing and
filtering river
gravels to recover free particles of gold and produce dore bars
(> 95% Au). With no
chemical processes involved, mining and processing operations do
not pose the
risk of introducing into the environment the chemicals used to
recover gold by
many other mining projects.
The Lower Tipuani alluvials would be mined out over a four-year
span (1999 - 2002).
During this period, Aluvion projects recovering over 257,000
ounces of gold, or
an average of 64,300 ounces per year. Cash operating costs are
estimated at US$93
per ounce (these projections have been reviewed by Watts, Griffis
& McOuat).
Kaka River. Subject to financing, operations are currently
projected to begin in
the year 2000; gravel deposits, if economically producable, could
last for an
estimated minimum 20 year mine life (this prospect is not subject
to seasonal
shutdowns during the rainy season).
Sun River Mining / Rio Del Sol have entered into a letter of
intent with
Central Cooperative Teoponte, which represents nine local
cooperatives
operating along the Kaka River. Subject to funding and
performance requirements,
the Kaka River properties are expected to be acquired in return
for a production
royalty (no cash / shares / debt).
NEW LISTING ("SUNR" on OTC:BB)
GOLD PRODUCTION PROJECTED TO BEGIN IN 1999
PROJECTED ANNUAL PRODUCTION OF > 150,000 oz/yr @ US$96/oz
FOR MORE INFORMATION CONTACT:
SUN RIVER MINING, INC.
Suite 201 5353 Manhattan Circle
Boulder, Colorado 80303 USA
Phone: (303) 543 - 8434
WATTS, GRIFFIS & McOUAT REPORT
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