Newcrest Mining has entered a farm-in agreement with Canadian company Mirasol Resources at the Altazor gold project in northern Chile.
The Altazor project is in an underexplored region of the South American country’s highly prospective Mio-Plioscene mineral belt.
Newcrest signed a one-year option agreement with Mirasol in November last year to acquire up to 80 per cent of Altazor in multiple stages by completing a series of exploration and development milestones and paying Mirasol $US1.8 million ($2.5 million) in option payments.
The Australian gold miner was offered the right to enter the farm-in upon completion of the option phase, in which it paid US$100,000 upon initial signing and spent $US1.5 million exploration spend in the first year of the program.
The farm-in stage is comprised of four stages over several years. The first stage will give Newcrest the option to acquire a 51 per cent majority stake in the project over the next four years by spending an additional $US8.5 million.
Newcrest can then increase its ownership to 65 per cent, 75 per cent and eventually 80 per cent in stage two, stage three and stage four respectively, over a period of eight years (or nine years including the initial agreement in 2017), subject to several conditions and payments.
The company has budgeted its seasonal exploration spend, which includes maiden drilling, at $US3.3 million.
Mirasol chief executive officer Stephen Nano commented, “The next stage of the earn-in represents a substantial financial investment from one of the world’s largest gold miners to advance exploration at Altazor,.”