Sunridge Gold (CVE:SGC) (OTCQX:SGCNF) has executed an agreement with the Estate of geologist Albert J Perry for a two-year option to purchase his 2% net profit interest (NPI) on Sunridge's portion of the Asmara Project, quantifying it and helping to advance its development plans.
Perry visited the area in the 1990’s and was the first to recognize the potential of the Asmara Project, receiving a 2% NPI on the property by a previous operator. Sunridge has inherited sole responsibility for this interest as Perry died in 2013.
After paying the Perry Estate a non-refundable amount of US$75,000, Sunridge will have a one-year option to purchase the NPI interest for US$1.5 million.
Should Sunridge not exercise this option within the first year then Sunridge can choose to pay the Perry Estate US$125,000 for the option to purchase the NPI interest for a second year for US$2.5 million.
The Asmara Project, held by the Asmara Mining Share Company (AMSC), a joint-venture company of which Sunridge owns 60% and the Eritrean National Mining Corporation ("ENAMCO") owns 40%. Sunridge would be the sole buyer for the Perry Estate NPI, which applies to the entire Asmara Project, paying for it using its share of cash flow from AMSC.
The Asmara project is pegged to produce an average annual rate of 65 million pounds of copper, 184 million pounds of zinc, 42,000 ounces of gold and 1 million ounces of silver over the first eight years. AMSC expects to start the first of three phases of production next year begins with high grade copper and gold, reaching full production by 2018.