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February 8, 2022

Barrick signs option deal with Latin Metals for Argentina assets

Barrick will have the right to acquire up to 85% in the Cerro Bayo, Cerro Bayo Sur and La Flora properties.

Barrick Gold has signed an option agreement with Canadian firm Latin Metals to acquire up to 85% in exploration properties in Santa Cruz province, Argentina. 

Through its wholly owned subsidiary, the deal offers Barrick Gold the right to purchase a stake of up to 85% in Latin Metals’ Cerro Bayo, Cerro Bayo Sur and La Flora properties. 

These properties are subject to an underlying option agreement, signed by Latin Metals with the underlying vendor in 2019 to earn a 100% stake in the three properties.

To earn an initial 70% stake, Barrick is required to pay $750,000 in cash to Latin Metals and $2.32m to the underlying vendor.

Barrick will also incur $5m on exploration work and prepare a preliminary economic assessment on the properties for Latin Metals.

Barrick has to make another payment of $425,000, ‘sole fund all costs’ and deliver a pre-feasibility study to earn a further 15% stake.

Upon completion of the initial 70% option, Barrick Gold and Latin Metals will form a joint venture (JV) with Barrick holding a 70% interest. Latin Metals will own the remaining 30% stake.

The interests of Barrick and Latin Metals will become 85% and 15% respectively in the JV, once the second option is complete.

Latin Metals president and CEO Keith Henderson said: “Barrick is a good partner who brings considerable technical and financial capability to the project.

“Assuming that the earn-in agreement runs to full term, Barrick’s investment of around $8.5 million will include payments to the underlying vendor, payments directly to Latin Metals and funding of work on the ground; all of which will help to limit dilution to Latin Metals’ shareholders.

“The earn-in agreement is consistent with the company’s prospect generator model, and the work contemplated, if successful, would advance the projects considerably, while Latin Metals will retain a minority interest.”

Last year, Latin Metals acquired the 4,000ha Yanba copper exploration project in the Coastal Copper Belt, Peru, from an undisclosed firm.

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