Eldorado Gold has entered a definitive option agreement with TRU Precious Metals to earn an 80% ownership interest in TRU’s Golden Rose gold-copper project in Newfoundland, Canada.
Under the agreed terms, Eldorado can secure the stake in the project by delivering staged payments and spending on exploration.
If Eldorado opts to proceed, it will negotiate a JV agreement with TRU, which would result in Eldorado owning 80% of TRU’s 100%-owned mineral claims.
Additionally, TRU would have the opportunity to acquire up to a 65% interest in adjacent claims currently under an option agreement with Quadro Resources.
Initially, TRU will operate the Golden Rose Project, with a technical committee overseeing work programmes and exploration expenditures.
This committee will consist of three representatives from Eldorado and two from TRU.
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By GlobalDataThe successful exercise of the option would lead to the formation of a JV between the two companies.
In the event that TRU’s JV interest falls below 10%, it would be converted into a 2% net smelter returns royalty, with Eldorado retaining the option to purchase 1% for $5m upon the commencement of commercial production.
The completion of the option agreement is subject to several conditions, including final approval by the TSX Venture Exchange, approval by TRU’s shareholders and the acquisition of necessary permits for exploration expenditures.
TRU co-founder and CEO Joel Freudman said: “We are thrilled to partner with Eldorado to advance the Golden Rose Project, which we consider a strong endorsement of the work completed since optioning the initial land package from Altius Minerals in 2021, including leveraging the support of our strategic investor Ormonde Mining over the past year.
“Eldorado’s expenditures under the option agreement will accelerate the advancement of the project’s gold and copper potential, while the cash payments will help fund TRU’s corporate overhead as we remain operator of the project.”
