Stornoway Diamond Corporation (TSX:SWY) entered into option agreements with 0954506 B.C. Ltd. to option the Qilalugaq, Pikoo and Timiskaming exploration projects. The Optionee will acquire an 80% interest in each of the projects upon completion of a defined exploration program, which is specific to each project.
As quoted in the press release:
Under the terms of the option agreements, the Optionee will acquire an 80% interest in each of the Qilalugaq, Pikoo and Timiskaming exploration projects upon completion of a defined exploration program (the “option work program”) specific to each project. The option work programs will be funded and operated by the Optionee. Stornoway retains a one-time back-in right to re-acquire a 20% interest in each project, thereby increasing its interest to 40%, by paying the Optionee an amount equal to three times the cost incurred by the Optionee in connection with the project-specific option work program.
Stornoway Diamond Corporation President and CEO, Matt Manson, said:
This option agreement allows us to move these promising exploration projects forward while allowing our management team to focus on the development of the Renard Diamond Project, our core asset. The bulk sample program at Qilalugaq, for which an Inferred Mineral Resource of 26 million carats was declared by Stornoway in June 2012, is designed to recover a large enough parcel of diamonds for a preliminary valuation and economic assessment. The Pikoo and Timiskaming work programs are designed to test for the presence of kimberlite with economic potential. At the end of each program Stornoway and the Optionee will be well placed to make a determination on whether to advance each project further within a joint venture, if results warrant.