Equus Mining Limited (ASX: EQE) has secured the rights to 100% of the Los Domos gold-silver project via an earn-in and purchase agreement with Terrane Minerals SpA announced on 25 October subsequent to the Quarter ended September 2016.
Under the agreement Equus is to fund a programme of systematic surface sampling and 2,000m of drilling. On completion of the drilling program, Terrane Minerals Spa (‘Terrane’) is to transfer its Los Domos project assets into a newly formed Joint Venture Company (‘JV’). Equus will hold a 51% equity interest and Terrane a 49% equity interest in the JV Company.
Equus has a two-year option to buy the remaining 49% interest in the JV by issuing Terrane A$450,000 worth of Ordinary shares in the capital of Equus Mining Limited at an issue price of 1.2 cents equivalent to 37.5m shares. Upon exercising this option Equus will own 100% of the project. The shares will be voluntarily escrowed for a period of 12 months. In addition, Equus is to reimburse historic costs of US$141k incurred by Terrane.
The Los Domos gold-silver project comprises 4,100 hectares of mining and exploration licences, located in Chile’s XI Region. The Los Domos gold-silver project is made up of 12 exploration licence and exploration licence applications owned by Terrane Minerals SpA and 3 mining licences held under option expiring December 2017 by Terrane Minerals SpA.
The Los Domos gold-silver project is located adjacent to the Cerro Bayo gold–silver mining operations currently owned by TSX listed Mandalay Resources. Historical production & current resources are shown in following table and historical drilling has totalled some 662,000 metres.
Source: Mandalay Resources Corporation – Cerro Bayo Project Technical Report NI 43-101 – March 13, 2015