Tarsis Resources (CVE:TCC) has met more of its goals set for this year as it has inked a non-binding preliminary deal to acquire a 100 per cent interest in four gold-silver properties in Mexico, and two gold properties in Nevada, from Almaden Minerals (TSE:AMM) (NYSE:AAU).
The Canadian junior mineral explorer said work is underway to consummate the acquisition through a formal agreement.
Under the terms, Tarsis will pay Almaden four million common shares and grant a 2% net smelter returns royalty on any production from the projects.
Areas of influence in Nevada and Mexico will be outlined, and Almaden will provide Tarsis with its proprietary data and concepts. In exchange for this data, Tarsis will issue 200,000 shares to Almaden for each new property acquired within the area of influence.
Tarsis will also issue a further 800,000 shares to Almaden once it first discloses a mineral resource on any of the new properties.
"We are very pleased to acquire additional properties from Almaden and continue our relationship with them," said president and CEO of Tarsis, Marc Blythe, in a statement.
"We respect their ability to identify high-quality mineralizing systems and we look forward to advancing these properties using the prospect generator model."
Tarsis' prospect generator model means it seeks out prospective exploration projects to acquire, and then vends or options them to partners for development. This model has allowed the junior to raise cash in an otherwise tough market.
“It’s been really tough for junior companies to raise money that don’t have a niche, a management team with particular experience, or a project that is appreciated,” Blythe says.
“We have a strong group of supporters who like the prospect generator model, and for this reason, we haven’t had difficulties to date.”
Indeed, the company has strong backers. Kinross Gold (TSE:K) invested about a year and a half ago, and now has around a 9% stake, while Sprott’s Rick Rule has a more than 10% interest. Almaden Minerals (TSE:AMM) also holds over 10%.
And there is even more proof that Tarsis hasn’t had any trouble raising cash. Last October, it closed a financing for total proceeds of just over $1 million, raising double what it had originally anticipated. Backers in the offering included Sprott, and management, which holds a significant chunk of shares, among others.
Currently, Tarsis has nine properties in the Yukon, Canada, and one in Mexico - the Erica property, which the company last month optioned to Osisko Mining Corp (TSE:OSK), already knocking off its first goal for this year.
The deal gives Osisko the right to earn up to a 75% interest by funding exploration and development of the property, and by making cash payments to Tarsis.
After completing the deal for Erika, the company's second priority this year was adding new properties in Nevada as well as in Mexico, a goal it crossed off with today's announcement.
Tarsis said each of the new properties in Mexico feature epithermal style mineralization and are prospective for gold and silver. Prospecting samples done by Almaden on the Gallo de Oro property returned values of up to 104 grams per tonne (g/t) gold.
Historic artisanal mining is evident with small pits and shafts on the property, the junior noted, but there is no evidence of drilling.
The Nevada properties, meanwhile, are prospective for gold and feature "Carlin-style pathfinder elements" believed to be supportive of this model. Preliminary soil work from the BP property features anomalous Carlin-style pathfinders including gold, thallium, arsenic, antimony and mercury.
Shares of Tarsis were flat at 9.5 cents in Toronto early Monday afternoon.
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