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Newcrest unit inks deal to own up to 75% of GFG's Rattlesnake Hills gold project

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Newcrest unit inks deal to own up to 75% of GFG's Rattlesnake Hills gold project

Newcrest Mining Ltd. subsidiary Newcrest Resources Inc. secured an option to acquire up to 75% of GFG Resources Inc.'s Rattlesnake Hills gold project in Wyoming, according to a Sept. 11 release.

Under the terms, Newcrest must pay US$100,000 in cash upon signing and spend at least US$2.6 million in exploration within 18 months from executing the deal. GFG will serve as project operator during the option phase.

After that, Newcrest can acquire an initial 49% of the project over a four-year period by paying GFG US$500,000 and spending a further US$14 million in exploration, with a minimum annual spend of US$1 million.

Newcrest can then raise its interest to 51%, with the right to earn an additional 4% for another two years, by paying GFG US$650,000 and funding the delivery of a positive preliminary economic assessment.

Should Newcrest continue its earn-in, the company can own 60% of the project, with the right to acquire a further 15% for another two years, by funding whichever is cheaper between additional exploration expenditures of US$80 million and the delivery of a positive bankable feasibility study.

Rattlesnake Hills consists of 1,573 unpatented lode mining claims as well as eight state mining leases across approximately 30,400 acres.