Canadian miner Kinross Gold has signed a $9.5m farm-in agreement with Sakumpu Exploration, a Finnish subsidiary of Australia-based S2 Resources.
The agreement is for an 83km² non-core gold tenements in Finland.
Under the binding agreement, Kinross Gold will have the option to earn a 70% stake in four exploration licence and licence applications in the Central Lapland Greenstone Belt (CLGB) of Finland.
In exchange, the Canadian miner is required to invest $3.5m on an exploration campaign at the tenements during the first three years.
Kinross Gold will serve as operator of the licences during the farm-in period.
In the event of Kinross Gold making a discovery under the farm-in agreement, S2 Resources will have the option to retain a 30% stake as a joint venture (JV) participant.
However, S2 Resources will retain its full ownership of the licences that host its core assets, notably the Aarnivalkea gold and Ruopas core nickel-copper targets.
S2 Resources’ near-term exploration activity will focus on these two targets.
S2 Resources CEO Matthew Keane said: “This transaction will expedite exploration on a group of highly prospective licences whilst allowing S2 to focus its funds on advancing the Aarni’ and Ruopas targets.
“Securing prospective tenure in the CLGB is becoming increasingly competitive, particularly with the recent exploration success of Rupert Resources and Aurion Resources.
“As such, we see this agreement as a win-win outcome for both companies and we look forward to working with Kinross.”
S2 Resource also is considering various strategic options for the remainder of its ground position in CLGB.