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Title:

Annual Information Form

Entities:

Gammon Lakes Resources Inc /Fi

Date:

2005

Size:

230KB total

Price:

$64

ID:

#1378103

 

 

► Miscellany ► Forms ► Information ► Annual Information Forms

 

 

Start of Preview

GAMMON LAKE RESOURCES INC.


ANNUAL INFORMATION FORM


For the Year-Ended July 31, 2005





October 17, 2005





GAMMON LAKE RESOURCES INC.
(the Corporation)

ANNUAL INFORMATION FORM

TABLE OF CONTENTS



Item 1: Corporate Structure 1

  1.1 Name, Address and Incorporation 1
  1.2 Inter-corporate Relationships 1

Item 2: General Developments of the Business 1

  2.1 Three Year History 1
  2.2 Significant Acquisitions 2

Item 3: Description of the Business 2

  3.1 General 2
  3.2 Mineral Properties 2

  3.2.1 Ocampo Project 2
  Location and Description 3
  Figure 1:   Location of Project 3
  Table 3-1:    Description of Mining Titles 4
  Soyopa Agreement 5
  Minera Fuerte Agreement 5
  Minimum Investment (assessment work) 6
  Exploitation Concessions 7
  Mining Duty (tax) 7
  Table 3-2:    Mining Duties 7
  Access 8
  Climate 8
  Local Resources 8
  Infrastructure 8
  Physiographic Description 9
  Historical Activity and Exploration 9
  Regional Geology 11
  Ocampo District Geology 11
  Deposit Types 12
  Mineralization 12
  Drilling 13
  Mineral Resources and Reserve Estimates 14
  General 14
  Geographical Area Model Division 14
  Data Analysis 15
  Northeast Area 15
  The Open-Pit PGR Trend 16
  Grade Estimation 17
  Validation 17
  Mineral Resources 17




  Mineral Resources contd 17
  Table 3-3:    Ocampo Total District Measured and Indicated
Mineral Resource Summary 		18
  Table 3-4:    Ocampo Total District Inferred Mineral Resource Summary 18
  Table 3-5:     Ocampo Detailed Northeast Ocampo
Mineral Resource Summary 		18
  Table 3-6:    Ocampo Detailed Measured and Indicated
Mineral Resource Summary 		19
  Table 3-7:    Ocampo Detailed Inferred Mineral Resource Summary 19
  Table 3-8:    Ocampo Proven and Probable Reserves 20
  Open-Pit Mineral Reserves 20
  Table 3-9:    Ultimate Pit Reserve Summary 21
  Table 3-10:    Annual Mining Summary 22
  Table 3-11:    Cumulative Open-Pit Mine Production 22
  Table 3-12:     Ocampo Mineral Reserve and Remaining Resource 23
  Underground Mine Plan and Reserves 23
  Table 3-13:    Proven and Probable Reserves by Level 24
  Table 3-14:    Proven and Probable Reserves by Mine Year 24

  Mineral Processing and Metallurgical Testing 25
  Underground Mine with Conventional Merrill Crowe Mill 25
  Table 3-15:    Master Underground Composite Description 25
  Table 3-16:    Test Program for Underground Ocampo Ores 25
  Table 3-17:    Bottle Roll Leach Test/ Recovery vs. Grind Size
96 Hour leach tests 		26
  Open-Pit Mine with Crushing and Heap Leach 26
  Table 3-18:    Test Programs for Open Pit/Heap Leach Ores 27
  Table 3-19:    Column Leach Tests on Crushed Core Material 28
  Table 3-20:    Ultimate, End of Mine Life Recoveries 29
  Underground Mine with Heap Leach 29
  Table 3-21:    Column Test on Aventurero Vein Material 30

  Mining Methods, Capital and Operating Costs 30
  General 30
  Underground Mine Operating Cost 31
  Table 3-22:    Underground Mine Operating Cost Summary 31
  Open-Pit Mining Methods, Capital and Operating Costs 31
  Table 3-23:    Mine Operating Cost Summary ($/tonne of Material Mined) 31

  Mill, Heap Leach and General Capital Costs 33
  Table 3-24:     Capital Costs Summary 34

  Mill, Heap Leach and General Operating Costs 34
  Milling 34
  Table 3-25:    Average Unit Operating Costs for the Milling Operations 35
  Crushing and Heap Leaching Operations 35
  Table 3-26:    Average Unit Operating Costs for the Heap
Leach Operations 		36




  Environmental, Social and Permitting 36
  Air Quality 36
  Vegetation and Wildlife 36
  Water Resources 36
  Cultural and Historical 36
  Socioeconomic 37
  Soils, Geology and Geochemistry 37
  Permitting 37
  Heuristica Amiental Report 37

  Utilities, Services and Infrastructure 37
  Water Supply 37
  Power Supply 38
  Access to Site 38
  Accommodations 39
  Administration Building 39
  Mill and Mine Maintenance Shop and Warehouse 39
  Laboratory 40
  Table 3-27:    Daily Samples Analyzed by Fire Assay Procedure 40
  Transportation 40

  Economics 41
  Summary 41
  Base Camp 41
  Table 3-28:    Project Economic Indicators 41
  Sensitivity Analysis 41
  Table 3-29:    Sensitivity Analysis 41
  Revenue 42
  Operating Costs 42
  Profit Sharing 42
  Reclamation Costs 42
  Royalties 42
  Capital Development, Acquisition Costs and Capital Cost Depreciation 42
  Exploration and Pre-Operational Development Expenses 43
  Working Capital Requirement, Sustaining Capital and Exploration 43

  Recent Drilling Results and Developments 43
  Table 3-30:    Ocampo Underground Drill Hole Intercept Summary 44
  Table 3-31:    Ocampo Open-Pit Drill Hole Intercept Summary 48
  Table 3-32:    Newly Reported Drill Results from Northeast
Underground Project Area 		49
  Table 3-33:    Newly Reported Drill Results from the Open-Pit Project Area 51
  Table 3-34:    Newly Reported Drill Results from Northeast
Underground Project Area 		53
  Table 3-35:    Newly Reported Drill Results from the Open-Pit Project Area 55

  3.2.2 Investment in Mexgold Resources Inc. 56




  3.3 Risk Factors 57
  3.3.1 No History of Profitability 57
  3.3.2 Exploration and Development Stage Corporation 57
  3.3.3 Foreign Operations 58
  3.3.4 Government Regulations 58
  3.3.5 Market Fluctuation and Commercial Quantities 58
  3.3.6 Mining Risks and Insurance 59
  3.3.7 Environmental Protection 59
  3.3.8 Capital Investment 59
  3.3.9 Conflicts of Interest 59
  3.3.10 Dependence on Key Personnel 60
  3.3.11 Lack of Active Market 60
  3.3.12 Currency 60
  3.3.13 Dividends 60
  3.3.14 Competition 60
  3.3.15 Possible PFIC Status 60

Item 4: Dividends 61

Item 5: Description of Capital Structure 61

  5.1 General 61
  5.2 Common Shares 61
  5.3 Class A and Class B Preferred Shares 61

Item 6: Market for Securities 62

  6.1 Trading Price and Volume 62
  6.2 Prior Sales 62

Item 7: Escrowed Securities 62

Item 8: Directors and Officers 62

Item 9: Promoters 64

Item 10: Legal Proceedings 64

Item 11: Interest of Management & Others in Material Transactions 64

Item 12: Transfer Agent and Registrar 65

Item 13: Material Contracts 65

Item 14: Interests of Experts 65

Item 15: Audit Committee Information 65
  Overview 65
  The Audit Committees Charter 66
  Composition of the Audit Committee 66
  Audit Committee Oversight 67
  Reliance on Certain Exemptions 67




Item 15: Audit Committee Information - cont'd
  Pre-Approval Policies and Procedures 67
  External Auditor Service Fees (By Category) 67

Item 16: Additional Information 68

Schedule A Audit Committee Charter A-1 A-5






Certain statements included or incorporated by reference in this Annual Information Form, including information as to the future financial or operating performance of the Corporation, its subsidiaries and its projects, constitute forward-looking statements. The words believe, expect, anticipate, contemplate, target, plan, intends, continue, budget, estimate, may, will, schedule and similar expressions identify forward-looking statements. Forward-looking statements include, among other things, statements regarding targets, estimates and assumptions in respect of gold production and prices, operating costs, results and capital expenditures, mineral reserves and mineral resources and anticipated grades and recovery rates. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Corporation, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Corporations actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Corporation. Such factors include, among others, risks relating to additional funding requirements, reserve and resource estimates, gold prices, hedging activities, exploration, development and operating risks, illegal miners, political and foreign risk, uninsurable risks, competition, limited mining operations, production risks, environmental regulation and liability, government regulation, currency fluctuations, recent losses and write-downs, restrictions in the Corporations loan facility and dependence on key employees. Investors are cautioned that forward-looking statements are not guarantees of future performance and, accordingly, investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein. Forward-looking statements are made as of the date of this Annual Information Form, or in the case of documents incorporated by reference herein, as of the date of such document, and the Corporation disclaims any intent or obligation to update publicly such forward-looking statements, whether as a result of new information, future events or results or otherwise.





ANNUAL INFORMATION FORM

For the twelve months ended July 31, 2005
Containing information as at October 17, 2005

ITEM 1: CORPORATE STRUCTURE

1.1 Name, Address and Incorporation

Gammon Lake Resources Inc. (the Corporation) has a head office located at 202 Brownlow Avenue, Cambridge 2, Suite 306, Dartmouth, Nova Scotia, B3B 1T5. The registered office of the Corporation is located at 1, Place Ville-Marie, Suite 3900, Montreal, Quebec, H3B 4M7.

The Corporation was incorporated under Part 1A of the Companies Act (Quebec) on February 25, 1986, under the name Golden Rock Explorations Inc.. By Articles of Amendment dated April 17, 1998, the Corporation changed its name to its current form of name, Gammon Lake Resources Inc., and consolidated its common shares on a 15:1 basis.

1.2 Inter-corporate Relationships

The table below provides details with respect to the Corporations direct and indirect wholly-owned subsidiaries.

Name of Subsidiary(1) Percentage of
Securities Owned		 Jurisdiction of
Incorporation or
Organization		 Nature of Business
Gammon Lake Resources 100% (direct) Barbados Holding corporation for
(Barbados) Inc.(2) Gammon Lake Mexico
Gammon Lake de Mexico S.A. de 100% (indirect) Mexico Operating corporation for
C.V.(3) the Corporation's Mexican
properties
Gammon Lake (USA) Inc.(4) 100% (direct)