GoldON Resources (TSX-V: GLD) announced this week it wants to earn an initial 60% interest and a subsequent 100% interest in Great Bear Resources' (TSX-V: GBR) West Madsen gold property in Ontario.
To pursue its initial goal, GoldON has entered into a binding Letter of Intent with Great Bear. The document stipulates that GoldON has to invest at least $1.2 million in exploration on the property over a 3-year period; pay Great Bear $145,000 in cash in different installments during the first two years, and issue 875,000 common shares of GoldON to Great Bear through the first two years of the option agreement.
For the initial 60% interest, the Victoria-based miner would have to invest $1.2 million in exploration on the propertyAccording to a press release issued by GoldON, to acquire the remaining 40% interest, the company would have to incur in additional exploration expenditures on the property of at least $750,000 on or before the fourth anniversary of the signing of a definitive agreement, and pay $500,000 cash or issue 500,000 shares to Great Bear at GoldON's election around the third anniversary of the signing of the deal.
The expanded West Madsen gold project is located in Ontario's Red Lake Gold District and comprises two claims blocks measuring roughly 6 kilometres by 3 kilometres in size, for a total area of 3,860 hectares.
Great Bear's information states that the project is a newly identified geological continuity of the greenstone belt within the Balmer and Confederation assemblages, which are host to the adjacent historical Madsen and Starratt Olsen mines.
"Results from neighboring Pure Gold's Madsen project, reported September to November 2016, include 126.6 g/t gold over 3.7 metres; 34.0 g/t Gold over 11.0 metres; 25.4 g/t gold over 8.0 metres; and 76.0 g/t gold over 2.1 metres," the company's brief reads.