(Alliance News) - Erris Resources PLC on Wednesday said it has concluded due diligence on its option agreement with GreenOre Gold PLC and will go ahead with plans to acquire 80% of the Loch Tay gold project in Scotland.
Shares in Erris were up 7.1% at 4.55 pence in London in morning trading.
The deal - announced on December 10 - gives Erris an option to acquire 80% stake in the Loch Tay project located in Perthshire, Scotland. Erris has now issued the option notice to GreenOre and will proceed with the exploration work necessary to earn the stake.
In order to earn the 80%, Erris said it has to define a minimum inferred resource of 250,000 ounce of gold within four years of the option notice date. GreenOre will retain the remaining 20% stake.
The project is comprised of 237 square kilometres of "highly prospective ground" and is 43 kilometres east of the Scotgold Resources Ltd's Cononish gold & silver mine.
Two priority target areas, Ardtalnaig and Glen Almond, have been identified as having gold potential. At Glen Almond, two samples from separate veins had a grading of 10 grammes of gold per tonne of ore or greater while a sample from historic mine dump at Ardtalnaig returned 9.4 grammes per tonne.
Erris Chief Executive Anton du Plessis said: "We are pleased that we can report a satisfactory completion of the due diligence review and proceed with the option agreement with GreenOre to advance the highly prospective gold targets in the Loch Tay licence. New results received and further fieldwork carried out when weather permitted over the past month have been very successful in expanding the gold potential of the project's key targets, Ardtalnaig and Glen Almond.
"Located in a well-mineralised district, our focus is now on advancing the project to initial drill-testing, targeting 250,000 ounces gold, which is a similar scale to the Cononish resource where a gold mine is expected to be in production soon. The current mapped footprint of mineralisation and alteration certainly shows this potential. I would like to thank our shareholders for their continued support following the announcement of the option on the Scottish project and I look forward to updating them with further developments."
By Anna Farley; annafarley@alliancenews.com
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