Arctic Star Exploration Corp (CVE: ADD, OTCQB: ASDZF) announced it had struck an option deal over its advanced Stein diamond exploration project in Nunavut, Canada.
The agreement is with GGL Resource Corp (CVE: GGL) over the latter earning a 60% interest in the project, which lies 85km northwest of the community of Taloyoa.
READ: Arctic Star Exploration shares up on second set of encouraging drilling results from Timantti project
Stein, covering 1,065 sq km, and hosting four permits, has seen numerous successive exploration campaigns and over C$1.5mln spent on it. One area has been flown with detailed airborne magnetic surveys, but no kimberlite drill testing has ever taken place.GGL can acquire a 60% interest by conducting detailed ground geophysics on high priority airborne targets and discovering kimberlite by drilling, trenching or in outcrop. Once kimberlite is discovered, a joint venture will be triggered with an initial 60/40 contributing relationship. The Stein project was identified and advanced by previous explorers from 2004 to 2008 with a small amount of additional work in 2011.
Arctic noted that the financial crash of 2008 and resulting inability to fund exploration programmes 'essentially' halted significant advancement of the project.
"The lack of advancement caused the mineral tenure to lapse. Arctic Star reacted to this opportunity and acquired the mineral rights in 2015," it said.
"Arctic Star's recent focus and deployment of resources has been the ongoing successful exploration of the Timantti Diamond Project in Finland, leaving Stein in portfolio yet to be advanced to drill testing."
GGL is a Canadian-based junior exploration company focused on diamond exploration in Canada's north with key projects in Nunavut as well as the Lac de Gras diamond district in the Northwest Territories.
Lac de Gras is home to Canada's first two diamond mines, the world-class Diavik and Ekati mines discovered in the 1990's.
On Friday, shares added over 5% to stand at C$0.10.