TIDMORE
RNS Number : 2803C
Orogen Gold PLC
27 June 2016
27 June 2016
Orogen Gold Plc
("Orogen Gold", "Orogen" or "the Company")
EARN-IN AGREEMENT SIGNED OVER GOLD-SILVER PROPERTY IN NEVADA,
USA
Orogen is pleased to confirm that it has completed due diligence
and executed a full Earn-In Agreement with Galileo Resources plc,
("Galileo") covering the Silverton gold-silver property in Nevada,
USA, as envisaged under the terms of a previously signed Term Sheet
announced in an RNS on 21 April 2016. Orogen will have the right to
earn-in to an initial 51% interest in Galileo's Silverton
Gold-Silver property ("Silverton" or the "Property") in Nevada, USA
by way of exploration expenditure of US$400,000 within 18 months
and thereafter the possibility to spend an additional US$1,500,000
within 30 months to earn-in a further 24% interest, in total 75%,
in the Property.
Galileo will have the right to participate pro rata after
Orogen's initial 51% earn-in; should it exercise this right it
would retain a 49% equity interest in Silverton. Refer to Appendix
I below for further details of the terms and to the news release of
21 April 2016 for more technical details regarding the
property.
Highlights
-- Due diligence review successfully completed and definitive agreement signed
-- Orogen has the right to earn an initial 51% interest in the
Silverton project over the 6km(2) claim area through exploration
spend of US$400,000 over 18 months
-- Orogen may earn an additional 24% interest in the project
through a further exploration spend of US$1.5 million over a
subsequent 30-month period
-- Galileo retains the right to participate pro rata after Orogen's initial 51% earn-in
-- Site visit identifies new target with historic silver/gold workings along cross structure
-- Focussed re-mapping and sampling programme commences to
confirm sites for an initial diamond drilling phase
Adam Reynolds Chairman said: "We are pleased to report the
completion of the definitive agreement with Galileo covering the
Silverton property. Interestingly, our site visit has already
pointed to additional targets not highlighted in the most recent
historic reports, which augurs well for further exploration and
drill target delineation. Further news will be released as we move
towards initial drill testing in the coming months."
The Property
The Silverton property comprises a block of 72 lode claims
covering about 6km(2) located northeast of Tonopah, Nevada USA,
where historic exploration has discovered widespread gold
mineralisation in a very prospective geological and structural
setting.
Technical Sign-Off
Ed Slowey, Operations Director of Orogen, is a Competent Person
as defined by various international instruments and takes
responsibility for the release of this information.
Enquiries:
Orogen Gold plc
Alan Mooney, Finance Director +353 1662
Ed Slowey, Operations Director 8395
--------------------------------- ----------
Cairn Financial Advisers
LLP (Nominated Adviser) +44 (0) 20
Liam Murray 7148 7900
--------------------------------- ----------
Beaufort Securities Limited
(Broker) +44 (0) 20
Jon Belliss 7382 8300
--------------------------------- ----------
Walbrook (Public Relations
and Investor Relations) +44 (0) 20
Paul Cornelius / Gary Middleton 7933 8780
--------------------------------- ----------
About Orogen Gold
Orogen Gold plc is a UK public company quoted on the London
Stock Exchange AIM market (ticker: ORE). The Company is focused on
mineral exploration and development and is currently operating a
gold exploration project at Mutsk in Armenia. The Mutsk project was
optioned by Orogen early in 2013 to follow-up reports of a new
epithermal discovery within an established gold district.
Exploration by Orogen has confirmed and extended the gold discovery
through diamond drilling and the deposit remains open in several
directions.
APPENDIX I - SUMMARY OF SILVERTON AGREEMENT TERMS
First Earn-In
-- Orogen shall spend US$400,000 on Exploration Expenditure
within 18 months from the signature date of the Agreement, the
exploration programme to include a drilling component. On
completion Orogen will have a 51% undivided interest in the
Property with Galileo holding the other 49% interest. If the full
amount is not spent on exploration within the required period then
Orogen shall have the right to transfer any shortfall in
expenditure on the Property and such transfer will form part of the
First Earn-In expenditure, provided that the shortfall does not
exceed US$100,000. Any funds thus transferred will be used
exclusively for approved exploration to complete the First
Earn-In.
-- Should Orogen not complete the First Earn-In by, or within 30
days of, the end of First Earn-In period, then the Agreement shall
be dissolved, with no recourse by Orogen to investment capital and
payments made.
Second Earn-In
-- Orogen may spend a further US$1,500,000 on exploration
expenditure within 30 months commencing within 30 days of
completion of the First Earn-in to earn a further 24% undivided
interest in the Property, giving Orogen an aggregate 75% interest
in the Property, at which point Galileo shall have a 25% interest
in the Property. However Galileo shall have the right at its
election to contribute pro rata to expenditure during the Second
Earn-In to maintain its 49% interest in the Property.
-- If Orogen continues to sole fund during the Second Earn-In
and the full amount is not spent on exploration within the required
period then Orogen shall have the right to transfer any shortfall
in expenditure on the Property and such transfer will form part of
the Earn-In expenditure, provided that the shortfall does not
exceed US$200,000. Any funds thus transferred will be used
exclusively for approved exploration to complete the Second
Earn-In. If Orogen spends a minimum of US$1,000,000 during the
Second Earn-In period, but does not complete the full Earn-In
expenditure, then it will earn a pro-rata additional interest in
the Property. If Orogen fails to spend the minimum US$1,000,000
during the Second Earn-In period then its interest shall remain at
51%.
-- On completion of the First or Second Earn-In the parties may
form a JV, pro rata their interest in the Property with contractual
terms in line with this Agreement. The JV shall aim to advance and
develop the Property towards commercial production including but
not limited to bankable feasibility study. If either Party elects
not to contribute pro rata its interest in the JV to production,
such non-contributing Party's interest in the JV shall be subject
to a straight-line dilution to a minimum 5% interest in the JV, at
which time the non-contributing Party's interest shall be converted
to a 5% net profit (before tax) interest.
-- Orogen, during First Earn-In and Second Earn-In shall be the
Operator of all exploration work on the Property as long as it
meets its requirements under the Agreement
-- Orogen and Galileo may assign or sell all or parts of their
interest under the Agreement to any third party subject to the
first right of refusal of the non-assigning Party, on the same
terms and conditions of assign or sale to the third party.
-- Orogen may in its sole discretion terminate this Agreement at
any time by giving not less than 30 (thirty) days prior written
notice to that effect to Galileo.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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