Lincoln Mining Corp. is poised to regain full control of the Oro Cruz gold project in California after signing a deal to reacquire the Hercules claims from ADGIS Inc., according to a May 11 release.
The Hercules claims consist of 20 lode claims covering the Oro Cruz pit and deposit. Along with the 131 lode claims already held by Lincoln, the Oro Cruz property now covers 151 claims covering more than 3,000 acres.
Lincoln will pay ADGIS US$500,000 in stages over five years and will grant ADGIS royalties, comprising a 2% net smelter royalty on production from the Hercules claims and a 1% net smelter royalty on production generated within a 1-mile radius but outside of the Hercules claim boundaries.
The company can reduce the Hercules royalty to 1.5% and the buffer royalty to 0.5% for a total of US$500,000.
Lincoln plans to seek a partner to advance the Oro Cruz project toward a preliminary economic assessment, given that it is focused on achieving production at its 60%-owned Pine Grove gold property in Nevada.
In March, the company terminated an option deal with Ausgold Resources Pty. Ltd. on Oro Cruz after the latter failed to satisfy its obligations.