St-Georges Eco-Mining (CSE:SX) has entered into a definitive option agreement with Aurania Resources (TSX-V:ARU) with respect to the Thormodsdalur Gold Project in Iceland.
Under the deal, Aurania has the right to earn up to a 70% undivided interest in the project via issuing up to US$150,000 worth of shares to St-Georges and incurring a total of US$5 million ($6.97 million) in expenditure over a four-year period.
Once completed, St-Georges’ subsidiary Iceland Resources will have the right to elect to either retain a 30% participating interest in the project, resulting in the formation of a joint venture with Aurania as project operator.
Alternatively, the subsidiary can convert its interest into an up to 3% net smelter return royalty, subject to an overall cap of 3% on the project, inclusive of any pre-existing royalties.
In the event Iceland Resources elects to retain a royalty interest, Aurania will have the right to increase its ownership to 100% by incurring an additional US$2 million in expenditure.
St-Georges says the agreement provides for the establishment of a joint exploration committee to oversee work programs and budgets, with Aurania acting as technical operation.
Completion of the deal remains subject to customary conditions, including the approval of the regulatory authorities.
Aurania expects to complete an initial exploration program focused on targeting drilling and surface exploration designed to test deeper and along-strike continuity of the known mineralised zones, using historical data and newly generated technical information.
A compelling opportunity
Aurania CEO Keith Barron says after visiting the project area and personally reviewing the archived drill core, the Thor Gold Project represents a “compelling” opportunity with strong exploration upside.
“By formalising our collaboration with St-Georges, we are positioning ourselves to unlock the potential of an under-explored geological district,” Barron says.
“Thor Gold displays all the key signatures of a robust epithermal gold system, supported by a history of documented high-grade mineralisation and a suite of compelling structural targets that remain largely untested by modern exploration methods.
“This agreement allows Aurania to deploy its technical expertise towards a highly prospective gold project. We look forward to progressing this project with discipline, technical rigour, and a strong commitment to unlocking its full potential.”
Iceland Resources CEO Thordis Bjork Sigurbjornsdottir says this is an “important” partnership for the company and it believes Aurania brings relevant experience to advance epithermal discoveries.
“Over the past several years, we have engaged in discussions with several groups with the objective of identifying a partner with the right technical experience and approach for this type of epithermal gold system,” Sigurbjornsdottir says.
The Thor Gold Project is a historically known gold-bearing, low-sulphidation epithermal system located 20km east of Reykjavik, Iceland. Gold mineralisation was first identified at the project in 1903, leading to a series of exploration and development campaigns between 1911 and 1924.
Historical records indicate that underground development included shafts and 400m of lateral workings, targeting a vein system estimated to be 1m wide and extending for at least 1km.
Subsequent exploration programs, including drilling campaigns in the 1990s and mid-2000s confirmed the presence of multiple mineralised quartz veins at depth, although core recovery in earlier drilling was variable.
St-Georges Eco-Mining develops new technologies and holds a diversified portfolio of assets and patent-pending intellectual property within several highly prospective subsidiaries.
Write to Aaliyah Rogan at Mining.com.au
Images: St-Georges Eco-Mining
