Sams Creek gold explorer, MOD Resources, has raised a $2 million loan from a long-term shareholder to underpin further test-drilling and for concept development studies.
Sams Creek, about 100km north of the Reefton goldfield, lies in a remote ridgeline in a mountainous region near Takaka, in the Tasman district, and contains an estimated 1 million ounces of gold.
The tenement is close to the Takaka River in steep hill country covered by beech and kamahi forests, bordered by the Kahurangi National Park.
MOD managing director Miles Kennedy was a founder of the Macraes mine in East Otago in the late-1980s and also secured access to the Reefton and Sams Creek areas.
Mr Kennedy said the $2 million loan would strengthen MOD's cash position, which stood at about $1.5 million at June 30.
''The additional funds will enable the company to conduct further drilling to follow up very encouraging high-grade drilling results at Sams Creek announced recently and to progress conceptual development studies for the project,'' he said in a statement.
He said the loan would also allow time for the sale of MOD's copper project in Botswana, with due diligence and negotiations ''at an advanced stage''.
MOD is partnered with Oceana Gold on the Sams Creek prospect. In order for it to lift its stake from 40% to 60%, MOD must continue to finance test-drilling. A targeted 80% stake relies on MOD determining if the estimated resource can be raised from 1 million oz to 1.5 million oz.
Assays following completion of the second stage of drilling are expected shortly, Mr Kennedy said.
