Brigadier Gold (BRG.V) has now signed the definitive agreement with Minera Camargo to acquire the almost 4,000 hectare large Picachos project in Mexico’s Sinaloa state. As previously disclosed as part of the option agreement, Brigadier Gold will be required to make US$275,000 in cash payments and incur US$3.85M in exploration expenditures over a five year period. Additionally, 4 million shares will be issued to the vendor while the vendor will also be compensated when Brigadier Gold reaches certain milestones: an additional 1M shares will be issued when a resource estimate exceeds 350,000 ounces of gold (not equivalent, but gold) in the inferred category while an additional 1M shares and US$725,000 in cash will be paid if a positive feasibility study greenlights the development of a mine.
A final US$2M milestone payment will be payable upon the project entering the production phase. Half of the cash payments can be settled in stock at a minimum price of C$0.30 to minimize the cash outflow.
Brigadier Gold appears to be looking forward to hitting the ground running as the company confirmed in its press release an initial 5,000 meter drill program will start within the next few weeks. The planned holes will tackle the mineralization at the past-producing San Agustin mine where previous operators encountered high-grade gold and silver mineralization.
Disclosure: The author has a long position in Brigadier Gold. Brigadier is a sponsor of the website.