PERTH (miningweekly.com) – ASX-listed explorer Ausquest has formed a joint-venture (JV) with Canada’s Etruscan Resources to develop a gold project in Burkina Faso.

The JV company, in which Ausquest will buy an initial 51% stake, will control a combined 670 km² strategic tenement holding in the relatively unexplored greenstone belt, in south-western Burkina Faso.

The agreement would provide Ausquest with entry to the West African gold fields, and a “head start to discovery” of potential gold resources, which it said was a key objective of the company.

Under the agreement, Ausquest would pay Etruscan $1-million for an initial 51% interest in the JV company, while the remaining 49% will be held by Etruscan.

Ausquest also had to sole fund the JV with at least $1-million during the first year, and could elect to sole fund a further $1-million to increase its shareholding in the JV company to 60%. The funds provided by Ausquest would be used for the exploration and evaluation of the tenements.

If Ausquest failed to provide the full $2-million in funding within the two years, it will forfeit its entire interest in the JV.

To increase its stake in the JV company to 80%, Ausquest could further fund $5-million within the subsequent four years. A minimum of $1-million must be provided to the JV company in each of the first three years.

“This is an exciting opportunity for Ausquest in a highly prospective, yet largely unexplored greenstone belt,” said Ausquest MD Graeme Drew.

“This investment in a project with substantial discovery potential in this region is consistent with our core corporate objective and complements our existing portfolio of projects in Australia,” Drew added.

To date, Ausquest has focused its search within Australia and it currently holds more than 39 000 km² of exploration title spread over 13 project areas.

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