Azimut Exploration Inc. said Sept. 26 that it formed a strategic alliance with Investissement Québec's SOQUEM Inc. subsidiary to focus on gold exploration within a 176,300-square-kilometer area in Quebec's James Bay – Eeyou Istchee region.
As part of the four-year alliance, Azimut will provide SOQUEM with a target report identifying major gold targets, from which SOQUEM will select four targets to be converted into properties at SOQUEM's cost. Each company will initially own 50% of the properties.
Azimut will act as manager of the alliance, while SOQUEM will provide up to 50% of associated field personnel.
SOQUEM can reserve additional targets that can be converted into properties under the same terms, but for the first four targets, SOQUEM may acquire Azimut's stakes by spending a total of C$3 million on exploration of the properties. Azimut will retain a 2% net smelter royalty over the initial four targets, 0.8% of which can be bought back for C$800,000 in cash.
The Investissement Québec unit will also have the option to acquire Azimut's interest in any additional targets by spending C$750,000 on each one over four years, subject to the same royalty terms as the initial properties.
Should SOQUEM fail to complete its investment requirement to secure full ownership of any given target, that target will become a joint venture project between the companies.
In addition, Azimut will have the right to explore targets not retained by SOQUEM, solely or with third parties.