Bullion major Barrick Gold has entered into an agreement to acquire up to an 85% interest in three exploration properties that Latin Metals owns in Santa Cruz, Argentina, the TSX-V-listed minerals explorer announced on Monday.
Barrick’s earn-in right consists of an initial option to acquire a 70% in the Cerro Bayo, Cerro Bayo Sur and La Flora properties and a second option for an additional 15% interest.
The properties are currently subject to an underlying option agreement, pursuant to which Latin American has the right to acquire an ultimate 100% interest in the properties.
“Barrick is a good partner who brings considerable technical and financial capability to the project," said Latin Metals president and CEO Keith Henderson.
“Assuming that the earn-in agreement runs to full term, Barrick’s investment of around $8.5-million will include payments to the underlying vendor, payments directly to Latin Metals and funding of work on the ground; all of which will help to limit dilution to Latin Metals’ shareholders,” he added.
The earn-in agreement is consistent with the company’s prospect generator model.