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Santana to secure 85% earn-in right over Becker gold project

Santana Minerals Ltd. has agreed to acquire the earn-in right over the Becker gold project in Chile from Collerina Cobalt Ltd., according to a May 17 statement.

The company will acquire 100% of Carlin Resources Pty. Ltd., which holds the rights to earn up to 85% of the project's granted tenements, covering 2,000 hectares, and 80% of its tenement applications, covering 6,000 hectares.

Consideration includes an issue of 10.0 million common shares by Santana, repaying a A$500,000 loan due to Carlin from Collerina and paying an additional A$1.3 million on definition of resources.

Carlin holds the Becker project under a joint venture with Patrick James Burns. Santana can exercise the option by paying A$900,000 in the next four years, in addition to the A$100,000 already paid.

The company will also need to drill at least 1,000 meters by Oct. 1, and estimate an initial JORC 2012-compliant resource and complete a scoping study by March 15, 2022.

The joint venture partner will retain a 15% free-carried interest to the start of a feasibility study, following which the partner can decide to take part in funding or convert to a 1.5% net smelter royalty, which can be bought for US$1.5 million.

Santana plans to undertake a partially underwritten renounceable rights issue to raise A$1.5 million to fund the acquisition and a diamond drilling program.

Norman Seckold, who is the chairman of both Santana and Collerina, has decided to distance himself from the deal.