Getchell Gold has completed the final cash payment and share issuance to acquire a 100% interest in the Fondaway Canyon and Dixie Comstock gold (Au) properties in Nevada, US.
This final step was achieved through a $1.6m cash payment and the issuance of $1m in shares to Canagold Resources, as per the terms of a 2020 option agreement.
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Under the agreement, Getchell was required to make a total of $2m in cash payments and $2m in share issuances over four years, alongside work commitments of $1.45m, which have now been met.
The company also granted Canagold a 2% net smelter return (NSR) royalty on each property, with the option to repurchase half of this royalty for $1m per property.
This acquisition follows three successful drilling programmes at Fondaway Canyon, which have doubled the size of the historic resource.
Getchell Gold is now focused on preparing a preliminary economic assessment. The recent mineral resource estimate revealed an inferred resource of 38.3 million tonnes (mt) at 1.23 grams per tonne (g/t) Au and an indicated resource of 11.0mt at 1.56g/t Au.
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By GlobalDataThe company has also closed the first tranches of its debenture financing and non-brokered private placement, with proceeds used to finalise the acquisition and fund further exploration.
Two of the company’s directors participated in the financing, contributing a combined $55,000.
Getchell Gold chairman and CEO Bill Wagener said: “The 100% acquisition of the Fondaway Canyon gold project is a major milestone event for the company.
“The Fondaway Canyon project has been an eye opener from day one with every drill hole, over three drill campaigns in the Central area, contributing to a doubling of an already sizeable historic resource.
“The closing of this acquisition serves as an immediate injection of significant value into the company, and considering that the gold mineralisation remains open in most directions, adds an indeterminate amount of future potential value waiting to be discovered.”
