NuLegacy Gold reduces Red Hill costs by $3.25-million
Nov 8, '12 - News Release
NuLegacy Gold Corp. has entered into an agreement that eliminates the earn-in requirement on Idaho Resources Corp.'s portion of the Red Hill project claims. The agreement has eliminated all of NuLegacy's exploration obligations on the Idaho claims, thus reducing the Red Hill project expenditure requirements by $1.2-million in 2013 and $3.25-million over the next three years.
As well, two of NuLegacy's option partners, Barrick Gold Exploration Inc. and Renaissance Gold Inc., have each agreed to defer $500,000 of the planned 2013 earn-in expenditures on their options to the years 2015 and 2016, respectively.
The combination of the elimination of the 2013 expenditures on the Idaho claims and the $1-million of deferrals on the Barrick and RenGold claims will reduce NuLegacy's total 2013 exploration expenditure requirements by $2.2-million from $4.8 million to $2.6 million. Negotiations are under way with the company's remaining option partner to further reduce its spending requirement for 2013.
NuLegacy will now focus its 2013 exploration expenditures on following up the discoveries made this past year in the central mineralized zone of the Red Hill project and the Wood Hills project.
Albert Matter, chairman, said, "We are very fortunate and pleased to have such good partners who recognize the remarkable exploration success that NuLegacy Gold has had in the central mineralized zone of the Red Hill project as well as on the Wood Hills project during these challenging markets."
The terms of the agreement with Idaho require NuLegacy to maintain the Idaho claims in good standing (estimated to be $75,000 per year) and make advance royalty payments to Idaho of $25,000 per year for two years and $50,000 per year thereafter, the payments of which will be credited against any future 3-per-cent net smelter royalty payments due on production from the claims. NuLegacy will also issue Idaho 200,000 shares (100,000 per year) over the next two years.
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