The Quebec subsidiary of American Barrick Resources (TSE) recently signed an agreement allowing it to earn a 75% stake on four of Messeguay Mines’ (ME) Launay-Privat gold claims. Situated 30 miles northeast of Rouyn-Noranda, Que., the claims contain zone 75 which hosts about half a million tons of grade 0.12 oz. gold per ton.
The property was originally optioned by Corona (TSE) before it was handed back to Messeguay in November.
Under a new agreement that Messeguay President Norman Farrell considers “very positive for us,” and Barrick will pay $10,000 cash and spend $200,000 on exploration prior to September. The agreement requires Barrick to spend an additional $1.5 million before December, 1992, and an extra $1 million before December, 1993.
By spending $1.7 million on the four claims, Barrick can earn 51% of the property and increase its interest to 75% after $2.7 million is spent. The deal also provides for Messeguay to convert its remaining 25% working interest into a 20% net profits royalty.
If an exploration program managed by Barrick leads to an open pit mining operation, Barrick must pay an advanced royalty of $200,000. (The royalty is established at $2.50 per ton milled indexed on the price of gold.)
Under the agreement, open pit development expenditures do not constitute exploration expenses, Messeguay says.
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