Junior miner Noront Resources has signed a $20-million deal with Cliffs Natural Resources to acquire 103 of the company's claims in the remote Ring of Fire mineral deposit.
The transaction includes a 100-per-cent interest in the Black Thor chromite deposit and the Black Label chromite deposit. It also includes a 70-per-cent interest in the Big Daddy chromite deposit and an 85-per-cent interest in the McFauld's Lake copper zinc resource.
Once the transaction is completed, Noront will hold around 360 mining claims, or roughly 80,000 hectares of the emerging mining camp known as the Ring of Fire, located 500 kilometres northeast of Thunder Bay.
?This purchase consolidates the world-class discoveries made in the Ring of Fire,? said Noront president and CEO Alan Coutts, in a press releae. ?It also underscores Noront's long-standing belief and commitment to the region. We have made significant investments in the Ring of Fire and our team has become experts in the region from both a technical and social point of view. We also believe in the considerable exploration upside which we are eager to develop.?
To finance the transaction, Noront has entered into a loan agreement with Franco Nevada Corporation.
Franco Nevada will loan Noront $22.5 million for a seven-year period at a seven-per-cent interest rate.
Franco Nevada will receive a three-per-cent royalty over the Black Thor chromite deposit and a two-per-cent royalty over all of Noront's property in the region with the exception of Eagle's Nest, which is excluded.
?Franco Nevada is pleased to support Noront in this acquisition,? said Paul Brink, Franco Nevada's senior vice-president of business development, in a press release. ?We believe that consolidating the interests in the Ring of Fire can unlock value for all stakeholders by focusing on a common vision for development going forward.