Amax Gold (NYSE) and Freegold Recovery (VSE) have agreed in principle to explore and develop the Golden Summit property in Alaska.
Amax can earn a 51% interest by spending US$5 million over six years. It can earn an additional 4% by completing a feasibility study and a further 5% by financing production.
The earn-in agreement piggybacks the original option which enables Freegold to earn 60% from Fairbanks Exploration (a private group) by spending US$1.79 million.
If it arranges financing, Freegold can increase its interest (prior to the Amax earn-in) to 81%.
Assuming Amax and Freegold each earn their maximum interests, Golden Summit will be split among Amax (60%), Freegold (21%) and Fairbanks (19%). Amax is preparing an exploration plan to meet the 1993 expenditure requirement of US$500,000.
Golden Summit is adjacent to Amax’s Fort Knox gold deposit.
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