Canyon Resources (ASX: CAY) continues to build exploration momentum in the red hot area of West Africa, by acquiring new tenement licenses which have doubled the company's footprint in the area.
Consideration comprises both cash and scrip over a three year period for full ownership, for a total of $550,000 in cash and 150,000 Canyon shares.
Highlighting the prospectivity in the area is three gold mines are located within 200 kilometres to the west of the permits.
These include the 1.8 million ounce Bissa Deposit, the nearly three quarter million ounce Sega Deposit abd the half million ounce Kalsaka Deposit.
The company will commence initial mapping and ground surveys before receiving the licenses and will begin more extensive exploration after the permits are granted.
Chris Connell, exploration manager, said “Canyon will commence initial mapping on the area, which will be the first Western exploration undertaken on these tenements.”
The acquisition includes four contiguous exploration permits for 1,004 square kilometres at the Derosa Project, doubling the company’s footprint to 2,128 square kilometres in Burkina Faso.
Canyon also has two other gold projects in the north of the country, the Taparko North and Tao Projects.
Both projects lie along strike from operating multi million ounce gold mines including Taparko with two million gold ounces and Essakane with five million gold ounces.
The company has strong relationships with successful explorers in Burkina Faso and is currently assessing other West African gold opportunities.
Phillip Gallagher, managing director, said “with the significant discoveries that are being made in Burkina Faso in recent years, meaningful and contiguous exploration permit holdings are becoming difficult and expensive to secure in Burkina Faso.”
The breakdown of the consideration is the Canyon will acquire the project through an initial payment of US$10,000 upon signing the contract and another payment of US$50,000 once the permits have been granted.
The deal also obligates the company to provide US$100,000 and 50,000 company shares on the first anniversary of granting the permits and another US$100,000 on the second anniversary.
The final instalment will be US$290,000 and 100,000 company shares on the third anniversary of granting the permits.
Canyon is currently well funded with $4.6 million on hand to fund planned exploration.