Sabina Gold & Silver Corporation (TSX: SBB)
As at December 31, 2011, DPM held 11.5% (fair value Cdn$71.0 million) or 18,539,713 million of the issued and outstanding common shares of Sabina Gold & Silver Corporation ("Sabina"). In addition, DPM held 5 million Sabina Series A special warrants, which will be automatically exercised upon a decision to proceed to a feasibility study or proceed to production on the Back River project or upon the occurrence of certain other events and 5 million Sabina Series B special warrants, which will be automatically exercised upon a positive production decision with respect to the project or upon the occurrence of certain other events. Each of the Sabina special warrants is exercisable for one common share for a period of 35 years and one-half of one common share purchase warrant ("Warrant") of Sabina. Each whole Warrant, if issued, will be exercisable until June 9, 2014, being five years from the date of closing of the sale of the Back River project to Sabina, at the discretion of DPM, for one Sabina common share at a price of Cdn$1.07 per Sabina common share. As at December 31, 2011, the estimated fair value of the 10,000,000 Sabina special warrants was $35.9 million.
Sabina is a rapidly growing precious metals company with the goal of becoming a mid-tier gold producer. It owns a highly prospective land package in one of the world’s newest and most politically stable mining jurisdictions - Nunavut, Canada. Sabina’s Nunavut assets comprise the Hackett River payable silver right from Xstrata Zinc as well as the high grade Back River gold project and certain other gold claims on the Wishbone Greenstone Belt.
Avala Resources Ltd. (TSXV: AVZ)
As at December 31, 2011, DPM held 110 million shares or 51.4% of the issued and outstanding common shares of Avala Resources Ltd. (“Avala”).
Avala is a Canadian-based gold and copper exploration company with title to seven exploration licenses (which takes into account the consolidation of certain licenses, as described below) and one concession for exploration and exploitation which total 800 square kilometres in area, located within the Cretaceous Timok Magmatic Complex in eastern Serbia. Avala’s focus since its creation in August 2010 has been the Sediment-Hosted Gold Project.
Sediment-hosted gold mineralization, located along the western margin of the Timok Magmatic Complex, represents a previously unrecognized style of gold mineralization within the Timok region. Avala holds a dominant land position in this newly emerging sediment-hosted gold region. In the third quarter of 2011, drilling of 29,481 metres (59,209 metres during the first nine months of 2011) was focused primarily on the Korkan-Bigar target area, located on the Potoj-Cuka Tisnica license areas. Expenses related to Avala exploration activities totalled $5.9 million and $13.1 million in the third quarter and first nine months of 2011.
Avala commenced RC drilling on a nominal 80 metre by 80 metre grid spacing at Bigar Hill in August 2011. Drilling will continue at Bigar Hill for the remainder of 2011. A second RC drill rig is expected to be operational in January 2012 and will commence on the Korkan and Kraku Pestar target areas. Additionally, selected locations within the target areas will be drilled to a nominal 40 metre by 40 metre grid spacing to provide geostatistical support and diamond ‘twin’ drilling of the RC drill holes will be carried out across the target areas at a nominal rate of 15% of total drilling. The resource definition program will focus on establishing continuity of mineralization, with a nominal 80 metre by 80 metre grid spacing within the mineralized ‘footprints’ which have been outlined by Avala during the earlier, wide-spaced, 160 metre by 160 metre diamond drilling programs.
Diamond drilling continued during the period with six diamond drill rigs assigned to the Korkan-Bigar target area and two drill rigs assigned to the Umka-Strnjak target area. At Korkan-Bigar, drilling continued with the wide-spaced program designed to effectively scale the size of the gold mineralized system within this target area. At Umka-Strnjak, the drills are being used to drill a series of scout holes on nominal 1,000 metre by 320 metre centers within the target stratigraphy in the southern 10 kilometres of the currently defined anomalous soil geochemistry in the sediment-hosted gold belt.
With the assistance of the Ministry of Environment, Mining and Spatial Planning, Avala has recently consolidated the Korkan-Bigar and Umka-Strnjak trends into one exploration license (previously two) which retains the name ‘Potoj Cuka-Tisnica’. The surrounding ‘Breza’ exploration license has also been consolidated into one exploration license (previously two). Both exploration licenses are valid until September 15, 2013 and renewable for additional periods following this date.
Dunav Resources Ltd. (TSXV: DNV)
On September 1, 2011, Dunav (previously Queensland Minerals) exercised its option agreement with DPM, wherein DPM received, amongst other consideration, a 47.5% controlling ownership in Dunav in exchange for DPM’s remaining Serbian properties, namely its Surdulica molybdenum, Tulare copper and gold and other early stage projects in Serbia directly held by Dundee Moly Company d.o.o. As a result of this transaction, DPM received 47,257,922 common shares of Dunav and 36,790,009 warrants to purchase common shares of Dunav at a unit price of $0.41 (Cdn$0.42) which are exercisable until September 1, 2013, subject to acceleration under certain circumstances.
As at December 31, 2011, DPM had a 47.7% ownership interest in Dunav.