Armistice Resources Corp. (TSX: AZ) and QMX Gold Corp. (TSX: QMX) jointly announced this morning that the companies have entered into a milling agreement.

Terms of the deal call for QMX to utilize its Aurbel Gold Mill facilities in the Val-d’-Or township of Quebec to process ore produced from Armistice’s McGarry Gold Mine operations in the Kirkland Lake district.

Armistice has begun preparing an initial shipment of 10,000 tonnes of ore and will subsequently deliver a minimum of 5,000 tonnes per month over the course of the next year.

“The custom milling agreement with QMX complements our plan to construct our own gold processing plant for the McGarry mine in the future by establishing a mutually beneficial arrangement to address our immediate and medium-term processing requirement,” said Armistice President and CEO Todd Morgan.

Added QMX President and CEO Francios Perron: “QMX has found a well-timed opportunity to partner with Armistice under this custom milling arrangement. In the last two years, the Mill has seen a number of improvements under the Lac Herbin Turnaround Plan but was still being underutilized. We are now able to supplement our own production with the ore delivered by Armistice to optimize our operations while also generating additional cash flow for the company.”

Armistice operates the McGarry Gold Mine within the Kirkland Lake district of Ontario. Project infrastructure consists of three compartment vertical shafts reaching a depth of 700 meters. The McGarry deposit contains a National Instrument (NI) 43-101 mineral resource estimate of 109,000 ounces of contained gold in the indicated category.

Meanwhile QMX (formerly Alexis Minerals) uses the Aurbel Gold Mill to process ore produced from its Lac Herbin mining operations. The company acquired the mill in 2009 as part of acquisition of Garson Gold Corp. and invested over $36 million in upgrades before re-opening the mill in March 2010.

Today’s announcement is a win-win for both sides as Armistice gains immediate access to a streamlined processing system without the need for a large capital investment and time requirement, while QMX can instantaneously fill excess capacity at its Aurbel Mill while generating additional revenues that will add directly to the bottom line.

Shares of Armistice and QMX are traded on the TSX under the ticker symbol AZ and QMX, respectively.

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