VANCOUVER, Dec. 22, 2017 /CNW/ - NXGOLD LTD. ("NxGold" or the "Company"), (NXN:TSXV) is pleased to report that it has entered into a binding term sheet (the "Agreement") with Roe Gold Limited ("Roe") and its shareholders to acquire an 80% interest in the Mt. Roe Gold Project ("Mt. Roe" or the "Project"), located in the Pilbara region of Western Australia.
Christopher McFadden, Chief Executive Officer, commented: "The acquisition of the Mt. Roe Gold Project located in the heart of the Pilbara gold region is an exciting addition to our high quality portfolio of assets. Similar to the adjacent Novo/Artemis joint venture, the Project contains outcropping conglomerates that are known to host gold nuggets, discovered at surface across the Mt. Roe Project."
Mt. Roe Gold Project:
Mt. Roe is comprised of approximately 1,200 hectares covering two exploration blocks and is located approximately 30 kms south of the port city of Karratha, Western Australia (see Figure 1). The Project is situated immediately adjacent to Novo Resources Corp. and Artemis Resources Limited's joint venture tenements and is known to contain outcropping gold-bearing conglomerates at the base of a basalt layer (see Figure 2). These known gold-bearing conglomerates have been traced for over 5 kms of strike length within the Project area. Additionally, gold nuggets have been discovered at surface on Mt. Roe with similar characteristics as gold discovered on nearby projects (see Figures 3 and 4).
The Terms:
Pursuant to the Agreement: (i) Roe will acquire an 80% interest in the Project and a special purpose vehicle ("SPV") formed by the shareholders of Roe will acquire a 20% interest in the Project, all pursuant to the terms of an existing option agreement (the "Option Exercise"); (ii) NxGold will acquire all of the issued and outstanding shares of Roe for a purchase price comprised of A$1.5 million cash and an aggregate of 19 million common shares in the capital of the Company (subject to a 4 month hold period). The Project will be held as a joint venture between Roe and the SPV pursuant to which the SPV will be free-carried through to Bankable Feasibility Study with standard dilution applying after that. If the SPV's interest in the Project falls below 5%, the balance of its interest will be transferred immediately to NxGold. The SPV will be granted a US$20 per ounce royalty over the Project and at completion will have the right to nominate one director to the Company's Board of Directors.
The transaction is subject to the completion of due diligence to the satisfaction of NxGold, due completion of the Option Exercise and receipt of all regulatory approvals including acceptance by the TSX Venture Exchange. Either party may terminate the agreement if the due diligence condition is not waived or satisfied within 7 days of execution of the Agreement or if any of the other conditions are not satisfied or waived within 14 days of execution of the Agreement. The cash component of the purchase price is payable upon satisfactory completion of due diligence and receipt of all regulatory approvals but is refundable if the Option Exercise is not completed.
Neither TSX Venture Exchange nor its Regulations Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
About NxGold
NxGold is a Vancouver-based exploration company. NxGold has entered into an earn-in agreement with Meliadine Gold Ltd. to earn up to a 70% interest in the Kuulu Project (formerly known as the Peter Lake Gold Project). Additionally, the Company has entered into an earn-in agreement to earn up to a 100% interest in the Chicobi Project located within the prolific Abitibi Greenstone Belt in Québec.
Qualified Person Statement
The scientific and technical information contained in this news release was prepared by Darren Lindsay, P.Geo., NxGold's Vice President, Exploration, who is a "qualified person" (as defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects). This news release refers to properties other than those in which the Company has an interest. Mineralization on those other properties is not necessarily indicative of mineralization on the Property.
