Barrick to earn in on Red Lake project adjacent to Great Bear's Dixie
The share price of CSE-listed Red Lake Gold surged on Wednesday as the Vancouver-based junior announced that it had granted Barrick Gold the right to earn in on its Whirlwind Jack project in Ontario, Canada.
The announcement was a “milestone event” for Red Lake Gold and its Whirlwind Jack project, said chairperson and CEO Ryan Kalt, stating that the agreement set the stage for potentially “millions of dollars of exploration work”.
Barrick may earn a 70% interest in the Whirlwind Jack project, located in Red Lake, by spending at least $4-million in the next 48 months and by delivering a National Instrument 43-101-compliant technical report that establishes a mineral resource of at least 500 000 oz of gold.
Subject to a successful earn-in by Barrick, a joint venture would be established in which Red Lake Gold would own 30%.
Kalt noted that the agreement also provided that Barrick may be requested to assist with Red Lake Gold’s share of potential mine construction costs, including the effective pass-through of Barrick’s cost of capital.
“[This is] a tremendous advantage for a junior exploration entity, such as Red Lake Gold,” said Kalt.
Whirlwind Jack is a district-scale gold exploration project, covering 21 238 ha of mining rights. The project is situated immediately adjacent and contiguous to the Dixie project, being advanced by Great Bear Resources.
Red Lake’s stock doubled in value on Wednesday, trading at C$0.27 a share, before closing at C$0.19 a share, up from Tuesday’s closing price of C$0.13 a share.
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