First Mining Gold Corp said its joint-venture partner, Auteco Minerals Ltd (ASX:AUT, OTC:MNXMF), has completed the Stage 2 earn-in requirements regarding the Pickle Crow Gold Project located in northwestern Ontario.
As per the earn-in agreement Auteco has spent $5 million on qualifying exploration expenditures, paid $1 million in cash to First Mining and has granted First Mining a 2% net smelter return (NSR) royalty on Pickle Crow. Auteco does have the option of buying back 1% of the NSR for US$2.5 million.
Additionally, Auteco, through one of its subsidiaries, has also increased its ownership in PC Gold Inc (TSX:PKL), to 70% from 51%. PC Gold is the joint venture entity that owns Pickle Crow.
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“At any time, following August 26, 2021, Auteco has a right to acquire a further 10% interest in PC Gold by paying First Mining $3 million in cash to increase its total interest in PC Gold to 80%,” First Mining Gold noted.
Currently, First Mining owns 125,000,000 shares of Auteco.
Dan Wilton, CEO of First Mining Gold commented that the company was excited that Auteco had completed the earn-in.
"This milestone formally provides First Mining with a royalty on Pickle Crow and an additional $1 million in cash to enhance our strong balance sheet. Our partnership with Auteco continues to surface value for First Mining shareholders as demonstrated by the success of Auteco's first phase 45,000 m drilling program, followed by the commencement of a second phase, 50,000 m drilling program,” Wilton said in a statement,
“First Mining looks forward to the ongoing exploration success at Pickle Crow that our partners at Auteco continue to deliver," he added.
As of June 30, 2021, Auteco had a cash balance of A$21.8 million and remains well-funded to execute the 50,000 m drill program planned for the next 12 months.
Pickle Crow is one of Canada's highest-grade past-producing gold mines. It operated from 1935 until 1966, during which time it reportedly produced almost 1.5 million ounces of gold at an average grade of 16.14 grams per tonne.
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