Malbex Resources (TSX:V.MBG, Stock Forum), a Toronto-based mining firm engaged in the acquisition and exploration of precious metal properties, announced today that the company had entered into an earn-in arrangement with Barrick Gold (TSX:ABX, Stock Forum) in regards to its Del Carmen project located in San Juan Province, Argentina.
According to the news release, Barrick has the option of earning-in to a 51% and then a 75% interest in the Del Carmen project based on reaching specific expenditure requirements.
As a result of the arrangement, Barrick has agreed to subscribe for an aggregate of 14.29m common shares of Malbex for an aggregate subscription price of $1.0 million.
Both the private placement and earn-in arrangement are dependent on Malbex causing the exploration agreement for Del Carmen to be transferred to a newly-minted entity jointly-owned by both Malbex and Barrick, along with the extension of the exploration agreement, the delivery of required work and environmental permits for Del Carmen.
The transfer of the exploration agreement requires the approval of the Instituto Provincial de Exploraciones y Explotaciones Mineras of the San Juan Province, Argentina and the transaction is still subject to TSX approval.
Malbex CEO, Joe Hamilton, commented, “We welcome Barrick to the Del Carmen Project.”
He went on to illustrate, “Barrick brings a depth of technical and regional expertise that is impossible to match. While Malbex personnel were successful in identifying and categorizing significant epithermal mineralization at Rojo Grande, the recent Preliminary Economic Assessment indicated that the economics of the project could be significantly enhanced by extending gold mineralization beyond the current resources.”
Then he finally concluded, “Barrick is most familiar with these systems in the Andes and has operated successfully in the area for decades. We look forward to their participation and operating expertise as we continue to move the project towards feasibility.”
Malbex was in the news recently when the company provided a Q1 2014 update at the end of February.
Shares climbed 66.67% to $0.05 per share.
Currently there are 132.3m outstanding shares with a market cap of $6.6 million.