Firesteel Resources Inc. said Aug. 4 that it signed a letter of intent with Pandion Mine Finance LP to secure US$20.6 million in financing via a prepaid forward gold purchase agreement.

The company will use the proceeds to acquire up to 60% of Nordic Mines Marknad AB, owner of the past-producing Laiva gold mine in Finland. Nordic Mines AB and Firesteel will operate Nordic Mines Marknad as a joint venture.

The funds will be received in two tranches of US$15.6 million with a tenor of 54 months, and US$5 million with a tenor of 46 months. Each tranche will have a grace period of 14 months after which the Firesteel will deliver 60,540 ounces of gold to Pandion for both tranches over the following 40 months.

The transaction is subject to the completion of the remaining due diligence, as well as the negotiation and execution of a prepaid forward gold purchase agreement.

Firesteel currently owns a 49% interest in the Star copper-gold property in British Columbia through a joint venture with Prosper Gold Corp.