Dynasty Gold Corp. said Feb. 1 that it signed an option agreement to acquire Teck Resources Ltd.'s 2,250-hectare Thundercloud gold project in Ontario.
Under the deal, Dynasty Gold has the option to earn up to a 100% stake in Thundercloud after spending C$6 million on project exploration over five years and issuing 1 million shares to Teck. Half of the share consideration will be due within seven days of exchange approval for the deal, and the remaining half will be due on the first anniversary of the agreement.
At least C$300,000 of the mandatory project expenditures must be spent in the first year.
Teck will retain the right to earn back a 65% interest in Thundercloud by spending C$15 million on the project over four years. This right may be exercised by giving Dynasty gold notice within a specified period of time, and if the right is not pursued, Teck would retain a 2% net smelter royalty over the property.
Dynasty Gold may reduce Teck's royalty to 1.5% in exchange for a C$1 million cash payment.
