Northern Superior Resources Inc. (TSX-V:SUP, OTCQX:NSUPF) told investors it has granted Evolution Mining Ltd (ASX:EVN) an option to acquire a 75% undivided interest in its October Gold Project in return for C$7 million in expenditures and cash payments totalling C$1.1 million.
The project is part of the previously announced Ontario assets Northern Superior plans to spin out. Upon the closing of the spinoff transaction, it said the option agreement will remain in full force and is expected to be assigned to the spinoff company.
Noting that ASX-listed Evolution is a leading gold company with a market capitalization of more than C$5 billion operating five wholly-owned mines in Australia and Canada, Northern Superior president and CEO Simon Marcotte commented: “This partnership will significantly accelerate the development of the October Gold Project with the support of a leading gold producer equipped with substantial resources,”
“Our Ontario spinoff company will therefore be able to focus on its primary asset, the coveted TPK project, renowned for hosting the largest gold grains in till anomaly in North America,” Marcotte added in a statement.
“Meanwhile, Northern Superior continues to advance its exploration and consolidation strategy of the Chibougamau Gold Camp in Québec, where the company owns four advanced projects well-suited to be integrated into a single mining operation."
Under the earn-in and joint venture agreement, Evolution can earn the 75% interest by incurring an aggregate of C$7 million in expenditures, including at least C$1.5 million on or before the second anniversary of the agreement, an additional C$1 million by the third anniversary, at least an additional C$2 million by the fourth anniversary, and a further amount of at least $2.5 million by the fifth anniversary.
In addition to the expenditures on the project, Northern Superior said Evolution will pay C$1.1 million in staggered payments up to 60 business days after the fifth anniversary of the agreement.
Northern Superior Resources is a gold exploration company focused on the Chibougamau Camp in Québec.
Contact the author at stephen.gunnion@proactiveinvestors.com