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Kirkland Lake Gold has taken an ownership position in two gold exploration sister companies in the Kirkland Lake camp and is prepared to spend up to $120 million on exploration.
In what's being framed as a strategic partnership and a potential joint venture opportunity, Kirkland Lake Gold is acquiring a 9.9 per cent interest in Orefinders Resources and Mistango River Resources. Both junior companies are under the direction of Stephen Stewart.
Orefinders is sending 24.4 million common shares Kirkland Lake Gold's way in return for more than $2.4 million.
There's also an option agreement where Kirkland Lake Gold can acquire up to 75 per cent of Orefinder's three main assets - Mirado, McGarry and Knight - contingent on the gold mining company spending $60 million in exploration and development of these very promising gold projects.
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Orefinders has been running a drill program and intersecting gold at its Knight Project, southwest of Kirkland Lake in the Shining Tree area. The property includes the former Tyranite Mine.
Mirado is a 559,000-ounce resource south of Kirkland Lake Gold's Macassa Mine. McGarry is beside the former Kerr-Addison Mine, once a 11-million ounce producer over a 58-year history.
With Mistango, there's an identical agreement as Kirkland Lake Gold also has the option of acquiring a 75 per cent stake in Mistango's Omega and Kirkland West Projects - the latter being just west of Kirkland Lake Gold's Macassa Mine - in return for spending $60 million on these projects.
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Mistango believes Kirkland West is an extension of Macassa. Omega, located east of Kirkland Lake, contains a 600,000-ounce gold resource.
Mistango will issue Kirkland Lake Gold 14.3 million common shares for proceeds of $2,145,000.
"Orefinders and Mistango are excited to jointly announce this unique partnership and equity investment with a top-tier operator like KL Gold," said Stephen Stewart, CEO of Orefinders Resources and the chairman of Mistango, in a statement.
"We see this as a testament to our assets' quality and our specific focus on the Kirkland Lake district of Ontario. With Kirkland Lake Gold's financial and technical support, we are excited to realize our portfolio's full potential while also seeking new acquisition opportunities."
Toronto-based Orefinders is an exploration company focused on gold exclusively in the Abitibi Greenstone Belt of northeastern Ontario. It has an 19 per cent ownership in Mistango River Resources.
