Origin Gold (OIC) has signed a definitive agreement to acquire the Otu Central gold project in Colombia from Bullet Holding Corp.
Located in the in the Segovia and Zaragoza regions of Antioquia, the 24,255-hectare project consists of interests in 26 mining claim titles and applications, which the Toronto-based company will wholly acquire for a total of approximately C$12.2 million.
Roughly $1.36 million of this amount will be paid in cash, with a further $4 million to be paid in common shares following the completion of a private placement.
An additional $3.4 million in common shares will be issued to Bullet on the one-year anniversary of the deal, with the same amount to be issued on the second anniversary.
Bullet will also retain a perpetual two per cent net smelter royalty on the Out Central Project, excluding mining title T4638005, which is already subject to a 5 per cent royalty payable to a third party.
Jaime Lalinde, President and CEO of Origin Gold, said he is pleased to have signed a definitive agreement for the much-anticipated acquisition of the Otu Central Project.
"We believe Otu to be a world‐class gold district with enormous upside now that once‐inaccessible land can finally be explored.
"It’s a tremendous opportunity, and we are thrilled to be working on it with Bullet, a company with invaluable experience in Colombia’s gold sector," he added.
Bullet has agreed to provide exploration expertise during initial phases of work, and will be entitle to nominate one individual for election to Origin's board of directors.
Origin Gold (OIC) is currently steady at $0.24 per share, as of 2:32pm EDT.