Altiplano Metals Inc is set to option into the Pastillas gold exploration project, which sits near four advanced, world-class gold assets in the prolific Maricunga district of Chile.
The deal means the firm can buy 100% of the project over four years by paying US$1.23 million in cash, issuing 1 million of its shares and spending a minimum of US$2.9 million on exploration.
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"This is an excellent exploration project with scalable potential located within elephant country of the prolific Maricunga district which hosts numerous mines and advanced stage gold and copper projects," said Altiplano CEO Alastair McIntyre in a statement.
"The acquisition of Pastillas syncs with the company's strategy of developing near term cash flowing assets but also focusing on large scale exploration projects with the potential of developing significant mineral resource potential."
The project comprises 3,100 hectares (ha) of concessions and sits 20 km south of the Fenix project (Rio 2), 20 km north of Volcan (Hochschild); 12km northeast of La Pepa (Yamana Mineros), and 14 km west of Lobo-Marte (Kinross).
Early-stage exploration results at Pastillas are consistent with a high-level expression of epithermal and porphyry mineralization in the region, also noted Altiplano.
Sparse rock chip sampling has yielded elevated gold up to 26.5 parts per billion (ppb) and anomalous values in important pathfinder elements.
Under the terms of the agreement, a 2% net smelter return (NSR) will also be retained by the optionor with a provision for Altiplano to buy back one-half (reducing to a 1% NSR) for US$2 million until the 8th anniversary of the agreement.
Altiplano's goal is to grow into a mid-tier producer of copper, gold, and silver with immediate plans of generating profits from three cash flowing projects in 2021.
Contact the author at giles@proactiveinvestors.com