Vancouver’s Pacton Gold is expanding its holdings in the Red Lake gold camp in northwestern Ontario.
The exploration firm has signed a binding letter of intent with TomaGold to acquire its 39.5 per cent joint venture (JV) stake in the Sidace Lake Property with Evolution Mining and Newmont (formerly Goldcorp).
The property is next to Pacton’s current claim package and is regarded as an advanced gold project with more than 81,600 metres of drilling.
In this joint venture, Pacton would be the project operator with intentions to queue up an aggressive drill program while still continuing exploration on its other properties in Red Lake.
The Sidace Lake Property is 28 kilometres northeast the town of Red Lake.
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“Sidace Lake is an exciting gold project with a clear path for potential growth,” said Pacton Chairman Dale Ginn.
“It is directly adjacent to our existing Red Lake land package and we look forward to entering the JV, as operator, and working with Evolution Mining to advance the project.”
The letter of intent will graduate up to a definitive agreement whereby Pacton will pay $250,000 and issue 10,000,000 common shares, and within six months pay another $250,000 and issue $800,000 worth of common shares.
When the gold resource estimate on the property reaches 750,000 ounces of gold, Pacton will issue 4,166,666 common shares.
Pacton has one of the largest exploration property holdings in the Red Lake district at 23,000 hectares.
Their properties are wedged between Pure Gold’s Madsen Mine project, Great Bear Resources’ Dixie Project, and Newmont Goldcorp’s gold mine complex.
“This is an excellent transaction for TomaGold and Pacton,” said TomaGold President-CEO David Grondin.
“It will give us shares in a company with strong upside potential and enable Pacton to strengthen its land position in the Red Lake gold mining camp with a high-quality mining asset close to its Red Lake Gold project.”
Besides working in the Red Lake area, Pacton Gold has exploration properties Western Australia.
TomaGold has another joint venture with New Gold and Evolution-Newmont with the Baird property in Red Lake and a slew of gold properties in the Chicougamau mining camp of northern Quebec.
