Republic International Corp., 6985 Union Park Center, has signed a letter of intent with a Utah man and two companies that will lead to establishment of a joint venture and the extraction of bitumen, asphaltic, other mineral deposits and precious metals near Whiterocks, Duchesne County.
Robert D. Radcliffe, Republic chairman and chief executive officer, said the letter of intent was signed with John E. Fausett, Fort Duchesne; Wilcox Investment Co., Park City; and Whiting Petroleum Corp., Denver.Republic expects to integrate this project with other Republic projects in the area now under way with the Utah Indian Tribe, he said.
The agreement permits ownership by Republic of 81 percent of the shares of a proposed joint venture corporation with the parties, which will have ownership of the reserves of asphalt and precious minerals in the project.
Whiterocks is a large oil-impregnated rock deposit in the Navajo sandstone having a single pay zone with thickness up to 1,000 feet and containing in excess of 200 million barrels of oil.
Radcliffe said assays indicate more than 2 million troy ounces of precious metals such as gold, silver and platinum with the sand.
Future plans call for construction of a stripping plant wherein a flotation process will be used to separate oil from the tar sand. Pilot studies from the University of Utah indicate a 92 percent recovery efficiency.
Under terms of the letter of intent, Republic initially will capitalize the new corporation with $2 million and convey five million shares of its restricted common stock to Wilcox.