Precious metals major Kirkland Lake is making an equity investment in Orefinders and Mistango River Resources, with the miner agreeing to acquire a 9.9% stake in each of the two gold juniors.
Additionally, Kirkland Lake is entering into a $60-million option and joint venture agreement with each of the companies.
Orefinders and Mistango – part of the Ore Group led by Stephen Stewart – are Kirkland Lake’s neighbours in the Kirkland Lake gold district of Ontario, where the larger miner’s Macassa mine is located. Mistango is currently drilling west of the high-grade Macassa underground mine.
Between Orefinders and Mistango, Ore Group has the third largest land position in the district, third only to Agnico-Eagle and Kirkland Lake Gold.
“It is a very exciting deal and opportunity for Orefinders and Mistango. It is something that we have been working on for a long time,” Stewart, who is CEO of Orefinders and chairperson of Mistango, said on a webcast on Wednesday.
Orefinders would issue Kirkland Lake 24.4-million shares at C$0.10 each for C$2.44-million and would grant Kirkland Lake the option to acquire up to a 75% interest in its Mirando, McGarry and Knight projects, in return for spending $60-million in exploration and development on the projects.
In a separate transaction, Kirkland Lake would acquire a 9.9% interest in Mistango and would have the option to acquire a 75% interest in Mistango’s Omega and Kirkland West projects in return for spending $60-million in exploration.
“With Kirkland Lake Gold's financial and technical support, we are excited to realise our portfolio's full potential while also seeking new acquisition opportunities," said Stewart.
Orefinders’ stock rose by 16% to C$0.10 a share.