Exploration and development company Palladium One Mining has entered into a binding letter of intent to buy back an existing 2% net smelter return (NSR) royalty in respect of the historic Haukiaho deposit of the palladium dominant, Läntinen Koillismaa platinum group elements (PGE)/nickel/copper project in Finland.
“The historic Haukiaho deposit is now royalty free. Buying back the existing royalty on Haukiaho eliminates a dilutive overhang on the project while also providing future optionality,” Palladium One CEO and president said Derrick Weyrauch in a statement issued on Thursday.
The terms of the royalty buyback include a cash payment of C$50 000 and issuance of 375 000 common shares of the company on closing.
The transaction is expected to close this month, and is subject to definitive documentation, customary terms, conditions for a transaction of this nature and TSX-V approval.
The Haukiaho zone is hosted in the basal unit of the Koillismaa complex and was first discovered in the 1960s by Outokumpu while exploring for copper and nickel.
Widely spaced historic reconnaissance drilling indicates the mineralised zone extends for at least 12 km along this basal unit.
“We believe that the Haukiaho zone holds great potential not only for expansion of the historic Haukiaho deposit but also new discoveries along this 12 km trend,” Weyrauch indicated.