TORONTO (miningweekly.com) – Canadian exploration firm Orex Minerals has closed a joint venture deal with miner Agnico Eagle Mines to develop the Barsele gold project, in Sweden, which is billed as one of Scandinavia's best mineral projects.
Agnico acquired a 55% interest in a corporate entity that owned the project for $6-million, with a further $2-million payable by Agnico Eagle in cash or shares at its discretion on each of the first and second anniversaries of the closing.
As part of the transaction, Agnico Eagle had committed to spend $7-million on the project over three years and would earn a further 15% interest in the corporate entity if it completed a prefeasibility study.
Under the terms of the transaction, Orex was also granted a 2% net smelter royalty on future output from the project. This could be repurchased by Agnico at any time for $5-million.
Agnico would also have a majority of board seats and would be the operator of the project for customary compensation.
The Barsele gold project was about 600 km north of Stockholm. Orex believed there to be significant exploration upside potential and inherent value at Barsele, where it had hoped to discover and define a 1.5-million-ounce to 2-million-ounce gold deposit.
There also was potential to discover polymetallic volcanic massive sulphide deposits on Barsele’s total mineral claim holdings of about 32 709 ha.