JOHANNESBURG (miningweekly.com) – TSX-listed Yorbeau Resources has signed a non-binding letter of intent (LOI) with dual-listed Kinross Gold Corporation, giving Kinross the option to acquire a 100% interest in Yorbeau's Rouyn property, located in the Abitibi greenstone belt, in Quebec.

The LOI outlined mutually acceptable terms for a definitive option agreement, under which Kinross would make certain exploration expenditures towards an option to purchase a 100% interest in the property over a four-year period.

Kinross also committed to participate in a $1-million private placement of units in the company upon signing the definitive option agreement.

"Company management is enthusiastic to partner with Kinross to advance the Rouyn project, with the intention of realising value for all project stakeholders,” stated Yorbeau president Gérald Riverin.

To earn the purchase option, Kinross had to complete a resource estimation for the property after funding C$12-million of exploration expenditures, including a firm commitment to spend C$3-million in the first 18 months, with no less than 12 500 m of diamond drilling.
Kinross would be the operator and project manager of the property during the option period and Yorbeau would have representation on a technical committee which would oversee the work programme.

On completion of the resource estimate, Kinross would have the option to acquire a 100% interest in the property for a single cash payment of $25-million, plus 2% of the prevailing gold price, multiplied by the number of ounces of gold in measured, indicated and inferred resources identified by Kinross.

In addition to the cash payment, Yorbeau would retain a 2% net smelter return on any gold ounces produced in excess of the number of ounces identified by Kinross in the resource estimate and on any other minerals produced from the property.