Unigold outlines earn-in agreement with Barrick Gold
Unigold Inc. [UGD-TSXV, UGDIF-OTCQX] has announced the execution of a long-form agreement with Barrick Gold Corp. [ABX-TSX, GOLD-NYSE] that details the terms under which Barrick can earn into Unigold’s 100%-owned Neita concession in the Dominican Republic.
The deal includes a shareholders’ agreement to govern the joint venture which will be formed upon successful completion of earn-in requirements for exploration, development and mining in the area.
Unigold shares were unchanged at $0.07 in early trading, Friday. The shares are currently trading in a 52-week range of $0.075 and $0.04.
Unigold is Caribbean-focused company. It is working to develop the 21,031-hectare Neita concession in the Dominican Republic, a country that is highly prospective for gold and polymetallic mineralization.
Unigold has held the Neita area under various exploration concessions since since 2002. In that year, the company applied to spit the area into the northern section (Neita Norte) and the southern section into Neita Sur. The 10,903-hectare Neita Norte Concession was granted to Unigold in March 2023.
Neita Norte is dominated by the Cretaceous-age Tireo formation volcano sedimentary rocks, which is known for hosting major gold-copper-silver deposits. It can be traced for 300 killometres along a northwest-southeast strike and averages 35 kilometres in width.
Unigold has previously focused on the multi-million-ounce Candalones deposits, a series of early VMS and disseminated deposits overprinted by epithermal feeders in acid volcaniclastic rocks. They are located on the Neita Sur concession. Unigold delivered a feasibility study for the oxide portion of the Candelones deposit in the fourth quarter of 2022.
“We are excited for Barrick to initiate exploration in the Neita Norte area,’’ said Unigold Chairman and CEO Joe Hamilton. “We have always viewed the western portion of the Tireo Formation as being the most prospective for finding large gold deposits in the Dominican Republic.’’ He said Barrick operates the Pueblo Viejo mine in the Dominican Republic and has installed a significant amount of related infrastructure in the country.
Under an agreement announced on July 14, 2023, Unigold granted Barrick the option to earn a 60% interest in the Neita Norte Exploration Concession. The major can exercise the option by spending US$12 million on the concession within eight years and delivering a prefeasibility study. Barrick must also deliver a written notice to Unigold electing to exercise the earn-n right.
Barrick can then increase its interest in the concession to 80% by delivering a feasibility study by the end of year 12 of the agreement.
The joint venture deal is subject to standard dilution clauses which includes the criteria that should any partner own less than 15% of the joint venture, they would be immediately diluted to a 2.5% NSR royalty. Barrick is the manager and operator of the project.