In a news release, UrbanGold Minerals Inc. (UGM:TSX.V) and Northcore Resources Inc. announced "the signing of an option agreement between the companies regarding the acquisition of the Monaco property (the Property)." The report indicated that the Monaco property is located in Quebec's Lower James Bay area and encompasses about 8,375 hectares consisting of 149 largely contiguous map-designated cells.
The terms of the property acquisition agreement require that upon signing Northcore Resources must make a $10,000 cash payment to UrbanGold Minerals. Northcore must then issue 2.8 million common shares of its capital and then make a second and final $10,000 payment to UrbanGold within a period of one year from the date the agreement was executed. After the completion of these requirements and listing of the Northcore shares on an exchange within one year of the signature, 100% ownership of the property will pass from UrbanGold to Northcore.
The firms reported that under the terms of the agreement Northcore will also be required to pay a 1.0% net smelter return (NSR) royalty to UrbanGold, but may reduce the royalty to 0.5% in exchange for a $1 million cash payment to UrbanGold. In addition, Northcore will be honoring a previously existing 1.0% NSR royalty to unnamed third parties.
The firm noted that the Monaco property covers a 20-kilometer segment along the Urban-Barry volcanic belt. The area is situated to the west and on-strike with the Windfall Lake gold project that the firm commented that in recent years has been the location of an unprecedented amount of successful exploration work. The company pointed out that Osisko Mining Inc. (OSK:TSX) and Bonterra Resources Inc. (BTR:TSX.V; BONXF:OTCQX; 9BR2:FSE) are both active in the area and have jointly drilled in excess of 1.3 million meters to date.
The company stated that the area the property is in has been subject to only very limited prospecting and no prior drilling. The firm noted though that it appears to cover the Urban-Barry "deformation zone" trend, which seems to control the gold mineralization.
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