Pacton Gold Inc (CVE:PAC, OTC:PACXF) has expanded its footprint in the Pilbara, with the acquisition of a 70% interest in what's called the Hong Kong project from Clancy Exploration Ltd.
The exploration licence adjoins the firm's Friendly Creek and Golden Palms projects and gives the company a bigger footprint in the Egina area - emerging to be the main focus of conglomerate gold exploration in the region.
"Through the process of evaluating the extensive portfolio held by Pacton in the Pilbara region, we are further appreciating the significance of the association between the primary shear hosted and conglomerate styles of gold mineralization in the region," said Alec Pismiris, interim president and chief executive at Pacton.
"We look forward to working closely with Clancy to explore the Hong Kong project as part of our broader Egina area development strategy."
The Hong Kong project consists of a single exploration licence covering 40.15 square kilometres (sq km).
More than five km of strike have been mapped within the project and notable historical alluvial gold mines lie within these formations.
In addition, structurally controlled, greenstone-hosted gold mineralization has been historically mined across the property.
Under the terms of the binding letter of intent (LOI), which will be formalized by a definitive agreement, Pacton can buy the 70% stake by paying Clancy $175,000 and issuing them with over 3.7 million shares.
Upon completion, Pacton and Clancy will enter into a joint venture.
Pacton will act as operator of the Hong Kong project.
A minimum of $500,000 must be spent within two years. Clancy will be free carried with respect to expenditures until a decision to mine is made unanimously by both parties.
Reporting by Giles Gwinnett.