Gold Terra might earn a 60 per cent interest to mining claims beside the former Con Mine area through a new agreement with Newmont Ventures Limited and Miramar Northern Mining Ltd.
Gold Terra intends to begin a drilling program by the end of the year on the Newmont Exploration Property, south and east of Yellowknife.
In the first phase of the agreement, Gold Terra can earn a 30 per cent interest by spending at least $3 million on exploration work over three years on the Newmont Exploration Property. After the phase one earn-in the two companies will form a joint venture.
In the second phase, Gold Terra can earn another 30 per cent interest in the joint venture by funding all expenditures and completing a pre-feasibility study outlining the resource that contains at least 750,000 ounces of gold on the Newmont Property.
The study would also have to outline the total of 1.5 million ounces of gold on the Newmont Property and on the claims in the area that are already owned by Gold Terra.
“The achievement of this Agreement reflects the shared vision of two companies with the same goal, ‘find more gold’,” said Gerald Panneton, Executive Chairman of Gold Terra. “Our agreement allows Gold Terra to better explore the southern extension of the prolific Con mine, where approximately 5.1 million ounces of gold was produced from the Campbell Shear between 1946 and 2005. With this transaction, Gold Terra secures the immediate southern extension of the Campbell Shear mineralization, which is immediately north of our 100 per cent owned South Belt property.”
Gold Terra would have up to four more years to complete earn-in for phase two and will manage and operate that program.
If the company completes the phase two earn-in, Newmont retains a one-time right to earn back a 20 per cent interest in the joint venture, which would give Newmont a 60 per cent interest and Gold Terra a 40 per cent interest.
That right is activated if at least 5 million ounces of gold is discovered on the Newmont Property.
Gold Terra Resource Corp. was formerly known as TerraX Minerals until a name change took place in February.