Eurasian Minerals (TSXV: EMX; NYSE: EMXX) is cashing in on its exploration work in Turkey.
The company announced it is selling its Akarca gold-silver project in the northwestern part of the country to privately owned and Turkish-based Colakoglu Ticari Yatirim A.S.
Selling Akarca fits with the company’s prospect-generation business model and adds to a treasury that held $20 million in March.
With the sale, Eurasian’s Turkish business unit will oversee the Sisorta and Golcuk projects, as well as some royalty properties. In addition to the Turkish business unit, the company also has separate units covering Haiti, Australia-Asia Pacific, Sweden and the Western U.S.
Along with creating a basket of assets across the globe, the company has also forged partnerships with some significant players in the industry, including Newmont Mining (TSX: NMC; NYSE: NEM), Antofagasta (LSE: ANTO), Vale (NYSE: VALE), Freeport-McMoRan Copper & Gold (NYSE: FCX) and Inmet Mining (TSX: IMN).
As for the sale of Akarca, the deal will net Eurasian cash payments, gold bullion, work commitments and a royalty interest.
The first of the reimbursements is an upfront payment of US$250,000. Colakoglu must then drill at least 5,000 metres by the end of the first year, and pay another US$500,000 to exercise an ownership option.
After it exercises that option, it will have to pay US$4.3 million over three years, drill 20,000 metres over four years and complete a feasibility study after the sixth year.
Akarca was discovered by Eurasian back in 2006. Gold and silver mineralization occurs in structurally focused, higher-grade vein zones and in disseminated, lithologically controlled lower-grade zones.
From 2009 until 2012 Centerra Gold (TSX: CG) spent $5 million at the project as per an agreement with Eurasian that gave it a 50% interest. In that time it defined six epithermal gold-silver mineralized zones occurring within a district-scale area.
Eurasian then took full control of the project again in 2012 by relieving Centerra of some of its
exploration and payment operations. From there it began its own drill program, focusing on five key areas: Sarikaya Tepe, Fula Tepe, Hugla Tepe, Percem Tepe and Arap Tepe.
This year the company announced results from Arap Tepe that were highlighted by 82.4 metres grading 0.77 gram gold
and 2.21 grams silver per tonne. Recent drilling at Sarikaya returned 36.4 metres averaging 5.67 grams gold and 53.31 grams silver.
Gold and silver mineralization occurs in a structurally focused vein style, as well as disseminated-style mineralization in silicified zones.
Beyond the cash payments and exploration commitments, Colakoglu has to deliver 8,000 oz. gold to Eurasian within the first year if the mine reaches commercial production. After that, if reserves are more than 1.35 million oz. gold, it must deliver 3,500 oz. gold to Eurasian. If reserves go over 1.7 million oz. it delivers another 3,500 oz., and if reserves go over 2 million oz., it would deliver another 3,000 oz. gold.
Eurasian also negotiated a 3.5% net smelter return royalty on any production from the property.