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THUNDER BAY -- North American Palladium plans to spend a minimum of nearly $5 million over five years to evaluate the scope of mineral deposits near Sunday Lake, only 25 kilometres north of Thunder Bay.
In June, the mining company signed an agreement with Impala Holdings and Transition Metals that gives it the right to acquire a 75 per cent ownership stake in the property.
In addition to spending money on exploration, North American Palladium will give its two partners $3.5 million in cash.
Drilling conducted at Sunday Lake over the past few years has uncovered platinum, palladium, copper and some nickel.
The Jacques Township property is just 95 kilometres by road from NAP's existing palladium mine and mill at Lac des Iles off Highway 527.
NAP vice-president David Peck told Tbnewswatch.com the Sunday Lake discovery "fits perfectly" into the company's strategy.
"We're trying to identify high-potential prospects in the greater Thunder Bay region, and this one was a little bit more advanced" than some others, he said.
Peck noted that the property's proximity to the Lac des Iles operation is critically important to the company, as "anything that we're spending exploration dollars on now and for the past few years had to really have the ability to ship ore eventually, if it's successful, to our mill."
He said the Lac des Iles deposit currently has an estimated life of nine to 10 years, but NAP would like to find a deposit to sustain the mill over a longer term.
Peck stressed that the Sunday Lake exploration project is still at a very early stage.
"It takes a long time from a discovery to prove that it's a resource. We have to adhere to all our (Ontario Securities) guidelines and issue technical reports. There's lots of hurdles."
