Kirkland Lake Gold (TSX:KL; NYSE:KL; ASK:KLA) is executing a strategic partnership with Mistango River Resources (CSE:MIS). KL Gold will acquire a 9.9% interest in Mistango when that company issues 14.3 million common shares at C$0.15 per share of Mistango to KL Gold.
Mistango has also granted KL Gold the option to acquire a 75% interest in its Kirkland West and Omega projects in exchange for spending C$60 million on them. Both properties are located near Kirkland Lake, Ont., where KL Gold operates the Macassa gold mine.
KL Gold will acquire an undivided 25% interest in the properties by making C$10 million in exploration expenditures with a minimum commitment of C$1 million in the first year and an additional C$1.5 million in the second year.
After five years, KL Gold’s and Mistango plan to create a joint venture for the properties with KL Gold as operator. KL Gold can acquire a further 25% interest in by spending C$50 million over five years following the establishment of the joint venture.
On the Cadillac-Larder Lake Break, Mistango’s flagship Omega property includes the historic mine of the same name. Indicated resources include 219,808 oz. of gold and inferred resource including 365,400 oz. of gold. Omega is adjacent to the Kirkland Lake-Cadillac-Larder Lake break project belonging to Orefinders Resources (TSXV:ORX; OTC:ORFDF) and the Larder Lake project of Gatling Exploration (CVE:GTR).
The Kirkland West property is contiguous with the Macassa gold mine. It covers 4,300 hectares along the Amalgamated and Main breaks where they converge with the Cadillac-Larder Lake break. The property includes the historic Baldwin mine and Eby zone.
(This article first appeared in the Canadian Mining Journal)