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Barrick, Japan Gold expand footprint with new project

The Kanehana project adjoins the west side of the Japan Gold’s Ikutahara project on the island of Hokkaido. (Reference photo.)

Barrick (TSX: ABX) (NYSE: GOLD) and Japan Gold (TSX-V: JG) are expanding their footprint in the Asian country with the acquisition of the Kanehana project, which comprises 40 new claims and covers seven historic gold mines.

The asset spans 12,431 hectares and adjoins the west side of the Japan Gold’s Ikutahara project on the island of Hokkaido, the country’s second largest.

Under a venture formed in February, known as Barrick Alliance, the companies will explore seven historic gold mines in the Kanehana project: Muka, Jindai, Jomon, Hokushin, Kokka, Hyakuhan and Souryu.

Combined, the Kanehana and Ikutahara projects cover a 25-kilometre strike-zone. Among the mines in this area is the region’s third-largest gold producer, the Kitano-o mine.

Gold-rich area

Japan Gold recently expanded its portfolio to reach a total of 31 projects across Japan’s three largest islands: Hokkaido, Honshu and Kyushu. The venture with Barrick covers 28 of them.

The Canadian exploration company said that one of the advantages of partnering with Barrick is that it retains 100% ownership of the assets if the gold giant chooses to not move forward with any of them.

Japan Gold  can then develop the projects itself or find another third-party to work with.

The Vancouver-based firm has attracted interest from other majors, including Newmont (NYSE: NEM) (TSX: NGT), which has a 13% stake in the Vancouver-based junior.

The world’s no. 1 gold producer became involved with Japan Gold in 2018, when Goldcorp (now part of Newmont) provided financing. As part of the deal, Goldcorp was granted a joint venture right of first refusal on two projects, the Ohra-Takamine and the Ikutahara project.