Klondike Gold Corp (CVE:KG) (OTCMKTS:KDKGF) told investors it was again receiving revenue from its placer mining claims after striking a lease deal with small family firm Dulac Mining.
The firm has given Dulac the rights and permits to mine at the Upper Eldorado Creek property in the Yukon and it has already set to work and installed the plant.
READ: Klondike Gold reports encouraging high-grade gold assays from Yukon project
During the plant's commissioning phase, 38.07 troy ounces of gold was recovered, including 13.44 troy ounces of coarse nuggets, revealed Klondike.
Under the terms of the agreement, Klondike will receive a 10% gold production royalty from the placer mining, which is payable in raw gold.
"We are very pleased to be working with Dulac Mining on this project and are impressed with the professionalism exhibited in building and commissioning this new placer operation," said Peter Tallman, CEO at Klondike.
Character of the gold
"We are also excited by the character of the gold returned from initial mining and the resemblance to gold found in outcrop and drill core from the nearby Nugget Fault gold trend. Dulac Mining’s operation provides Klondike Gold the opportunity to receive detailed exploration information at no cost in an important target area. In addition, the company once again is receiving revenues from its placer properties."
Upper Eldorado Creek consists of 114 contiguous placer claims over 6.8 sq km covering the Upper Eldorado Creek and Chief Gulch drainages, within Klondike's huge 576 sq km Klondike District property.
This placer property crosses visually similar gold-bearing quartz veins associated with the Nugget Fault 1,100 meters upstream of this current operation.
Shares nudged up 1.49% to stand at C$0.34 each.
Contact the author at giles@proactiveinvetsors.com