Kinross Gold (TSX:K) has begun drilling at West Point Gold’s (TSX-V:WPG) Jefferson Canyon Project in Nevada, US.
Drilling began on 23 September after the companies received permits and completed the required bonding.
Jefferson Canyon lies approximately 7km from Kinross’ Round Mountain Gold Mine in Nye County.
The work is being conducted by Kinross Gold USA, a wholly owned subsidiary of Kinross, under an exploration and option agreement signed in 2022.
The agreement gives Kinross the option to acquire an initial 70% interest in Jefferson Canyon for US$5 million ($7.2 million) and a further 10% for another US$5 million, representing potential option payments totalling US$10 million.
Kinross must also spend US$600,000 on exploration, make annual lease payments of US$75,000, and maintain the project’s unpatented mining claims.
The four-year option period began when permits were received on 19 August. It may be extended for up to two years, subject to certain conditions.
West Point would retain a 20% interest if Kinross exercises both options. An interest diluted below 10% would convert into a 1% net smelter return royalty.
Jefferson Canyon hosts a volcanic-hosted epithermal gold-silver system. Historical drilling returned an intercept of 41.2m @ 6.4 grams per tonne gold and 402g/t silver, although West Point’s qualified person has not independently verified the historical information.
No mineral resource estimate has been reported for the project.
West Point Gold is a Canadian explorer focused on US projects in Nevada and Arizona.
Write to France Pinzon at Mining.com.au
Main image: Kinross Gold
