Megastar Development Corp. (MDV:TSX.V) announced in a news release it entered an agreement to acquire, through its subsidiary Minera Mazateca, the entire Cerro Minas mineral concession from Gunpoint Exploration for $100,000 and 800,000 common shares.
The concession, which consists of 899 hectares of surface area, is in Mexico on the Oaxaca epithermal gold-silver belt. "The property is an inlier to Megastar's principal Yautepec project concession and covers 5 kilometers' strike length of highly prospective ground along a northwest trending caldera structural margin," the release noted.
"Given the exciting results we have announced to date from our Yautepec property, the addition of this land is very compelling for us," Megastar Exploration Manager and Director David M. Jones said in the release. "Completely surrounded by our current land holdings, Cerro Minas displays similar epithermal characteristics to targets that we have already identified."
With this agreement with Gunpoint, Megastar consolidates more than 7 kilometers of strike length of targets with great potential for epithermal and skarn mineralization.
According to the terms of the deal, Gunpoint will retain a 1.5% net smelter return royalty on Cerro Minas. Megastar may purchase 0.5% of that royalty for $1 million at any time.
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