VANCOUVER, British Columbia, Oct. 26, 2017 (GLOBE NEWSWIRE) -- Lumina Gold Corp. (TSXV:LUM) (the “Company” or “Lumina”) is pleased to announce it has entered into a non binding letter of intent (the “LOI”) for an earn-in agreement with First Quantum Minerals Ltd. (“FQML”) on its Orquideas and Cascas concessions (the “Properties”). The earn-in agreement is based on a minimum commitment of US$1.5 million in year one and would allow FQML to earn 51% ownership in the Properties if they elect to continue funding and payments totalling an additional US$37 million over a 5-year period. FQML and Lumina will work to formalize and execute a binding agreement by the end of 2017.
Marshall Koval, President & CEO, commented: “This partnership represents an exciting step forward for Lumina and the execution of our strategy to monetize primary base metal projects while advancing our primary gold deposits. Management is looking forward to working with FQML to advance these large scale base metal porphyry systems. FQML’s recent entry into Ecuador demonstrates additional support for the country and its growing mining sector.”
Summary of Key Terms Contemplated by LOI
FQML has committed to fund a minimum of US$1.5 million in exploration expenditures and fees by the end of year one, after which it can withdraw from the agreement with no retained interest. If FQML chooses to continue funding beyond year one they would have the right to earn 51% ownership in the Properties (“First Earn-in”) by meeting the required spending commitments over the five year period and paying certain cash payments to Lumina. Spending commitments and estimated concession license fees over the First Earn-in total US$31.5 million. Lumina would receive US$100,000 upon the signing of a binding agreement. In addition, cash payments of US$6.9 million would be received over the duration of the First Earn-in period. FQML would have the right under the agreement to stop funding prior to completion of the First Earn-in on either or both of the Properties.
FQML would also have the right to earn an additional 19% ownership in the Properties (“Second Earn-in”) by solely funding all the required work up to a decision to mine, taking FQML’s ownership in the Properties to 70%. Post the completion of the Second Earn-in, Lumina would be responsible for funding its 30% share of any capital required to develop and construct a mine at the Properties.
About Lumina Gold
Lumina Gold Corp. (TSXV:LUM) is a Vancouver, Canada based precious and base metals exploration and development company focused on gold and copper projects in Ecuador. The Company’s Cangrejos Gold-Copper project is located in El Oro Province, southwest Ecuador, and its Condor Gold-Copper project is located in Zamora-Chinchipe Province, southeast Ecuador. The Company also holds a large and highly prospective land package in Ecuador consisting of 135 thousand hectares. The Company has an experienced management team with a successful track record of advancing and monetizing exploration projects. The Company intends to continue to identify, acquire and advance mineral exploration properties that have large scale potential.
