Vanstar Mining Resources Inc (TSX-V:VSR, OTCQX:VMNGF) announced that it has struck a definitive option agreement with IAMGOLD Corporation for the Bousquet-Odyno gold project, directly south of Highway 117 between the towns of Rouyn-Noranda and Malartic, in Quebec.
Under the terms of the agreement, IAMGOLD has granted the Montreal, Quebec-based Vanstar an option to earn up to a 75% interest in the property, which is comprised of 37 contiguous mining claims covering roughly 1,492 hectares (ha).
The terms are like those contained in the letter of intent, and state that Vanstar has the option to complete as operator a minimum of $4 million in exploration expenditures over four years and will have the right to earn up to a 75% interest in the property.
READ: Vanstar Mining says partner IAMGOLD set to resume drilling at Nelligan this week
However, Vanstar will have to first complete the following steps:
- Vanstar can earn an initial 25% interest in the property by investing a total of $2 million in qualifying expenditures, over a maximum two-year period starting on March 11, 2022; and
- Vanstar can earn an additional 50% interest in the property, for a total 75% interest, by investing a further $2 million in qualifying expenditures over a maximum four-year period following the effective date.
The company said IAMGOLD will have a right to earn back a 50% interest in the property by spending four times the exploration expenditures made on the property since the completion of the second earn-in period within a time of three to five years, depending on the amount to be invested.
Contingent upon completion of Vanstar's 25% or 75% earn-in, and IAMGOLD's 50% earn-back, Vanstar and IAMGOLD will enter into a joint venture to hold and advance the property, said the company.
Upcoming work
Vanstar pointed out the Bousquet-Odyno property located along the Cadillac Break is fully permitted for drilling. The gold exploration company will first initiate a 4,000-meter (m) drilling program in April. The program is designed to test areas down plunge from known high grade zones, as well test additional areas on the surface, said the company.
Felix project
Meanwhile, Vanstar, which owns 100% of its Felix property in the Abitibi mining camp in Quebec, said the 2021 drill program on the Felix project “returned no significant gold intercepts.” Therefore, the company is evaluating its next steps in regard to the project.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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