TSX-V-listed Trillium Gold Mines has signed an agreement to buy the rights and titles to the Panama Lake property, which effectively extends the company’s contiguous foothold along the Confederation belt by 9 882 ha.
The Panama Lake property, held by St Anthony Gold, is located about 80 km from, and on the same structural trend, as Kinross Gold’s Dixie project in Ontario.
A long history of exploration activity has occurred on the Panama Lake project since the late 1960s. Recent diamond drilling completed by Benton Resources and St. Anthony Gold has continued to intercept anomalous gold values from the Panama zone and north of a highly anomalous gold grain till sample collected by the Geological Survey of Canada.
Recently completed interpretation of newly acquired airborne geophysics has identified several linear magnetic trends that appear coincident with the Panama zone and other gold occurrences found on the Panama Lake project. This new geophysical interpretation and recently obtained anomalous gold values from 2019 to 2022 diamond drill programmes will allow future exploration programmes to be focused on areas of high mineral potential.
In terms of the transactions, St Anthony will assign all its rights and obligations under the original option agreement to Trillium. In addition, Benton will agree to consent to the assignment and will agree to register 100% of the property’s title to Trillium, while retaining its 50% ownership interest in the property until such time as Trillium fulfils its option to earn 100% interest.
Trillium will pay St. Anthony C$500 000 in cash and issue one-million common shares in the capital of Trillium. In the event Trillium acquires a 100% interest in the property, St. Anthony may cause Trillium to exercise its buyback right under the option agreement to repurchase from Benton one-half of the 2% net smelter royalty (NSR) on the property and convey such repurchased 1% NSR to St. Anthony Gold in exchange for a cash payment to Trillium of C$1-million.
For Trillium to earn a 70% interest in the property, it will pay Benton C$100 000 in cash or the equivalent in shares and complete $250 000 in exploration expenditures on the project by April 24, 2023. Trillium has the option to earn 100% ownership of the property by paying Benton a further $300 000 in cash or the equivalent shares and complete $300 000 in exploration expenditures on the project, in each case by October 24, 2023.