Goldgroup Mining Inc. said Monday it will buy Almaden Minerals Ltd.'s 30 percent stake in the Caballo Blanco project, making Goldgroup the 100 percent owner of the Mexican gold project.
Goldgroup, which recently completed an earn-in of its 70 percent interest in Caballo Blanco, will pay Almadean Minerals $2.5 million and issue to Almaden 7,000,000 of its common shares. An additional 7 million of its common shares will be issued to Almaden if certain production conditions are met.
In addition, Goldgroup will also transfer to Almaden its 40 percent interest in the El Cobre property and grant a 1.5 percent net smelter royalty interest on the Caballo Blanco project to Almaden. Finally, Goldgroup will pay $650,000 and provide a 0.4 percent net smelter royalty on the Caballo Blanco project to the original claimholder of the property in settlement of certain rights and subject to certain terms and conditions.
Once the deal is done, Caballo Blanco production will be subject to an aggregate 2.95 percent net smelter return royalty, which includes a prior 1.5 percent net smelter return royalty over the 70 percent interest Goldgroup acquired from NGEx Resources Inc.