Metals Creek Resources has recently finalized an agreement with Delta Resources to sell its Shabaqua Corners Gold Project. This transaction grants Delta Resources a 100% interest in eleven claims and the opportunity to earn a 100% interest in an additional eight claims held by Gold Cache Inc. The combined claims cover a total of 233 hectares and are contiguous with the Delta-1 Property, showcasing several significant gold occurrences like the Echo Zone and Gold Cache Main Zone.
Additional Insight: By selling the Shabaqua Corners Gold Project to Delta Resources, Metals Creek can streamline its focus on its Ogden Gold and Tillex Copper projects, potentially allowing it to allocate more resources and attention to these ventures.
Financial Aspects of Agreement
As part of the deal, Delta Resources will pay $55,000 and issue 1,250,000 common shares to Metals Creek. Notably, Metals Creek will retain a 1% Net Smelter Return (NSR) royalty, giving Delta the option to buy back 50% of the NSR for $500,000. This arrangement offers Metals Creek essential financial benefits while maintaining a vested interest in Delta’s progress.
Immediate Benefits and Drawbacks
Positive aspects of the agreement include the initial cash payment of $55,000, receipt of 1,250,000 Delta Resources shares, retention of the 1% NSR royalty with a buyback value of up to $1 million, and reduced exploration costs while sustaining project exposure. However, divestment of the potentially lucrative gold property and delayed share vesting schedule of 312,500 shares every 4 months present some challenges.
Insight into Potential Growth
Delta’s strategic extension into the Shebandowan Greenstone Belt is notable, with an emphasis on uncovering undiscovered gold deposits. The company’s work at the Eureka Gold deposit and the potential for further discoveries within its expansive land package indicate a promising trajectory for Delta Resources, benefiting its shareholders and strategic partners.
Metals Creek’s Decision Impact
Metals Creek’s decision to sell the Shabaqua Corners Gold Project aligns with its long-term strategy to optimize resources and concentrate on projects with high growth potential. By entering into this agreement with Delta Resources, Metals Creek not only maintains exposure to future successes but also enhances its financial position for upcoming initiatives, aiding in sustained growth and development.
