Trifecta Gold Ltd. said Feb. 28 that it signed a letter of intent with Silver Range Resources Ltd. to acquire up to a 75% interest in the gold-prospective Yuge property in Nevada.
The property was discovered by Silver Range through data mining and covers the small-scale Columbia and Juanita mines.
Under the terms, Trifecta can earn a 51% interest in the project by completing a US$1 million work program on the property and paying US$250,000 in cash and/or shares by Feb. 28, 2021.
Trifecta also agreed to reimburse approximately US$7,100 in staking and recording costs.
Silver Range will be granted a 1% net smelter return royalty on the property as well as a success fee of US$1 per ounce, payable upon completion of a preliminary feasibility study based on measured and indicated resources of over 500,000 ounces.
Trifecta can earn an additional 24% project interest by paying an additional US$500,000 in cash and/or shares and spending a further US$2 million at Yuge by Feb. 28, 2023.
The company will also grant Silver Range an additional 1% net smelter return royalty, which can be purchased by Trifecta for US$1 million prior to production.
Trifecta and Silver Range will then enter into a joint venture to continue exploration on the property.
Should either party's interest dilute to below 10%, it would be converted into a 1% net smelter return royalty, half of which could be purchased for US$1 million.
Silver Range will act as the operator for the first phase of exploration and thereafter at Trifecta's election in return for a 10% management fee.
Trifecta plans to undertake geological mapping and sampling to define mineralization at the property in April and May, ahead of permitting and a systematic drill program later in the year to test the prospect.
