Eldorado inks deal to earn 80% of Newfoundland project

Eldorado Gold (TSX: ELD; NYSE: EGO) has inked an option deal with TRU Precious Metals (TSX: TRU) to acquire a major stake in the junior’s Golden Rose gold-copper project, in Newfoundland.

The deal gives Eldorado the option to earn an 80% interest in the gold project by delivering $8.3 million in staged cash payments and spend $7 million on exploration.

The involvement of Eldorado, which has operations and projects in Greece, Turkey and Quebec, is expected to expedite the development of the Golden Rose project. 

It will also boost TRU’s ability to manage corporate expenses while remaining the project’s operator.

If Eldorado exercises the option, the company is set to negotiate and enter into a joint venture agreement covering TRU’s mineral claims. This would result in Eldorado owning 80% in each of TRU’s 100%-owned mineral claims. TRU, in turn, would gain the right to acquire up to a 65% interest in certain contiguous mining claims that are subject to an option agreement with Quadro Resources (TSXV: QRO).

Golden Rose is located directly between Calibre Mining’s Valentine gold project and AuMega Metals’s Cape Ray gold project.

Buying spree

Eldorado has been on a buying spree this year. It acquired the Louvem property from Quebec-focused gold explorer O3 Mining (TSXV: OIII) in March. The asset consists of 12 mining claims and is located 5 km east of Agnico Eagle’s Malartic mine, which is one of Canada’s largest open-pit gold mines.

Eldorado teamed up with Brixton Metals (TSXV: BBB) earlier this month to advance the Atlin Goldfields project in northwest British Columbia.