PREMIER GOLD MINES LIMITED (PG:TSX) is pleased to announce that it has signed an Asset Exchange Agreement (the “Agreement”) with Red Lake Gold Mines (the “Partnership”), a subsidiary of GOLDCORP INC. (TSX:G, NYSE:GG).
Under the terms of the Agreement, the Partnership has agreed to transfer to Premier an undivided 50% interest in and to certain Mining Claims in the Red Lake District known as the Rahill-Wilmar and Kostynuk Properties, and Premier has agreed to transfer to the Partnership an undivided 50% interest in and to certain Mining Claims in the Red Lake District known as the Bonanza and Marathon Properties.
Premier and the Partnership have started exploration drilling on the combined properties, such Property being referred to as the Rahill-Bonanza Joint Venture Project. Premier is funding the initial CAD$1 Million in exploration on the Property, and future exploration will be funded on a 50:50 basis. Premier is the operator during the initial period of CAD$5 Million in exploration, and Goldcorp will be operator thereafter. At any time during the first eighteen (18) months following the formation of the joint venture, Goldcorp has the option to increase its interest in the joint venture by 1% to 51% by paying Premier CAD$440,000. Pursuant to this Agreement, Goldcorp has exercised its right to participate up to 20% in Premier’s recently completed financing.
About the Joint Venture Property
The Bonanza-Rahill Project is strategically located between Goldcorp’s Red Lake Gold Mine to the east and the Cochenour Gold Mine, and Gold Eagle’s (GEA:TSX) Bruce Channel discovery, to the west. Red Lake is world renowned for high-grade gold and the Red Lake Gold Mine is regarded as one of the highest grade gold mines in the world. The Property is host to several high-grade gold zones, several of which will be tested in the current program. Additionally, drilling will be conducted from the workings of the Red Lake Gold Mine onto the Joint Venture Property to test for the potential continuation of the horizons currently being mined onto the Bonanza-Rahill Project.
Premier has granted stock options to Talman Finance S.A. to provide investor relation services for the corporation in Europe for a period of 18 months. 125,000 options will vest immediately and can be exercised at a price of $2.50 for a period of 18 months and 125,000 options will vest in 3 months and can be exercised at a price of $2.75 for a period of 18 months.
Premier Gold Mines Limited is a Canadian-based mineral exploration and development company with diverse property holdings that include several projects and deposits in Northwestern Ontario and a joint venture in Mexico. In the Red Lake gold mining camp, two of these are operated in joint venture with Goldcorp Inc. (TSX:G). A strategic project is also located on the main Musselwhite Gold Mine trend (Goldcorp-Kinross).