Dixie Gold updates Red Lake Gold Project, Ontario

Dixie Gold Inc. [TSXV-DG] reported that it has divested four mining claims, deemed by the corporation to be non-core and representing less than 0.4% of the claim count of its Red Lake Gold Project, northern Ontario, for purposes of helping to facilitate anticipated regional infrastructure developments that involve corresponding surface area overlying the claims (such surface title not being owned by the corporation).

The Claim Sale was conducted by way of a purchase-and-sale agreement dated July 9, 2024 with Great Bear Resources Ltd. (GBR), an arm’s-length party and a subsidiary of Kinross Gold Corp. [TSX-K; NYSE-KGC], on terms described here. Subsequent to any applicable approvals and from the day forward of this news release, the corporation’s Red Lake Gold Project is expected to consist of 1,011 mining claims, with ordinary course forward-moving change to project claim count anticipated.

In connection with the Claim Sale, the corporation received cash consideration of $100,000 and was granted a 2.5% production royalty (NSR) on any mineral production from the four divested mining claims to the extent any gold or other metal production occurs therefrom, and GBR assumed existing royalty responsibility.

The corporation is also scheduled to benefit from certain exploration activity undertaken by GBR at its adjoining project which is expected through an assessment sharing arrangement to result in a one-time forward-year of Crown-granted anniversary extension on approximately 437 mining claims selected and held by the corporation, such area presently comprising portion of the Red Lake Gold Project most proximal to the activities of GBR and viewed by Dixie Gold as having elevated interest to the Corporation.

Dixie Gold continues to assess, and where appropriate, prioritize areas of its Red Lake Gold Project, noting that the Claim Sale recovers more than all of the original project acquisition costs spent by the Corporation for the entire project (then originally 1,241 claims).

The company remains committed to refining project scope and project size by evaluating past exploration work and the project’s forward-moving composition by way of various claim management activities, with a corporate goal to refine a project scale that is practical for any potential future field activity, optimized to recognize the carrying-costs imposed by the Crown on an annual-basis, and for the project to hold prospectivity for potential discovery and/or external interest.