Kinross Gold (TSX: K; NYSE: KGC) has signed a US$9.5 million farm-in agreement with a Finnish subsidiary of Australia-based S2 Resources (ASX: S2R) to look for gold.
The agreement covers about 83 sq.-km of S2's noncore gold tenements in Finland, with the Australian junior on Thursday saying that it would retain full ownership of 498 sq.-km of ground holding the Aarnivalkea gold prospect and the Ruopas Isovaara nickel-copper target.
Kinross has agreed to fund an exploration campaign over four exploration licences and licence applications in the Central Lapland Greenstone Belt of Finland in return for earning a 70% interest in the project.
The Canadian major would be required to spend a minimum of US$3.5 million over the first three years.
The deal is expected to trim S2's tenement holding costs, freeing up more cash to focus on its core Aarni and Ruopas exploration targets.
Securing prospective tenure in the Central Lapland greenstone belt is becoming increasingly competitive, particularly with the recent exploration success of Rupert Resources (TSXV: RUP) and Aurion Resources (TSXV: AU).
Rupert continues to hit lengthy gold intervals at its Ikkari prospect, part of the Pahtavaara project in the Central Lapland Greenstone belt. Aurion has struck a joint venture with fellow Canadian miner B2Gold (TSX: BTO; NYSE-AM: BTG), which resulted in new gold discoveries in two areas located on a 29,000-hectare land parcel in northern Finland. Kinross maintains a 9.98% interest in Aurion.
Keane described the agreement as a "win-win outcome."
Kinross has for years been a proponent of the incubator model, partnering with junior explorers to conduct greenfields exploration on its behalf through various deal structures, including earn-in agreements.
The Central Lapland Greenstone Belt remains underexplored despite the district hosting known tier-one gold and nickel-copper-platinum group metals deposits. Agnico Eagle Mines' (TSX: AEM; NASDAQ: AEM) 7.4 million oz. Kittil?? mine is one example of the scale of mineralisation the district potentially has to offer.