Phenom Resources has signed an option agreement to acquire up to a 100% interest in the King Solomon Gold Project, located in Nevada, US.
This strategic move involves a four-year option agreement with a private vendor for 100% in 178 unpatented mining claims, referred to as the King Solomon Gold Project.
Phenom committed to an aggregate payment of $150,000 and the issuance of 75,000 shares over a four-year period to fully exercise its option and acquire the King Solomon Property.
Additionally, the vendor will retain a 3% net smelter return (NSR) royalty on any mineral products derived from the property.
The company will have the opportunity to purchase up to a 2% NSR for $3m at any time, which would reduce the vendor's NSR to 1%.
Following the initial four-year term, advanced royalty payments will be required, starting at $60,000 per year for years five to ten, increasing to $75,000 per year for years 11–15 and then $100,000 per year thereafter until production.
The agreement also stipulates that any additional claims staked within an area of interest surrounding the current property will be incorporated under the same terms.
Phenom Resources will conduct a 25-day due diligence period to further assess the acquisition.
Securities issued in connection with the property option will be subject to a statutory hold period of four months and one day. The completion of this agreement is pending approval from the TSX Venture Exchange.
The King Solomon Gold Project comprises 178 claims over approximately 1,140ha in central Nevada.
It is situated 32km south of Phenom's Dobbin Gold Project and exhibits geological characteristics of a regional-scale Carlin-type gold system.
The project's location is also strategically significant, being 45km east of Kinross Gold's Round Mountain gold deposit and 45km south-east of the Northumberland Carlin-type gold deposit.
Phenom Resources company director and geological consultant Dave Mathewson said: “Phenom is only going after gold projects in Nevada that have regional scale targets. I have had my attention on this prospect for many years, so we are very excited to have secured King Solomon at this time.
“There is excellent potential for discovery of significant Carlin-type gold deposits there. Previous explorers appear to not have understood the full extent of, and significance of, the stratigraphy or gold model.
“Typical of earlier 1990s explorers, drilling was largely limited to shallow tests of 90m to 122m deep (300–400 feet), and was primarily focused on the potential within the overlying Tertiary volcanic rocks.
“Significant near-surface gold intercepts within Tertiary volcanics which, noteworthy as they are, suggest a bigger potential within the underlying more permissive, Paleozoic carbonate package.”
