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Metallic Minerals (TSXV: MMG) has signed a production royalty agreement on a portion of alluvial gold claims at its Australia Creek property in Canada’s Yukon Territory with Little Flake Mining, a company owned and operated by Parker Schnabel of Discovery Channel‘s television series, “Gold Rush”.
Metallic Minerals holds a 100% interest in 36.4 sqkm of mining rights along the Australia Creek drainage south of Dawson City. Australia Creek is part of the historic Klondike gold district that is estimated to have produced over 20 million ounces of gold since its discovery in 1898.
Australia Creek and its benches are now recognized by Yukon Geological Survey as the eastern continuation of the Klondike goldfields, the largest placer gold producing area in the Yukon.
Under the terms of the agreement, which covers 8.85 km of the alluvial gold claims, Little Flake will be granted exclusive rights to extract gold from the Australia Creek property, with Metallic Minerals receiving a percentage of the production as a royalty.
This partnership will combine Metallic Minerals’ expertise in mineral exploration and Little Flake’s experience in gold mining to maximize production and profitability for both groups in the region, the company said.
Schnabel is recognized as a highly experienced miner and, in December 2022, was awarded the Robert E. Leckie Award for Excellence in Environmental Stewardship by the Yukon government for reclamation work in the Klondike goldfields.
“We are excited to be working with Parker and the highly experienced Little Flake mining team and believe this partnership will be lucrative for both our companies, given Little Flakes track record of impressive alluvial gold production,” Metallic Minerals CEO Greg Johnson said in a news release.
“Our recent gold discoveries at Australia Creek represent a major extension of the Klondike to the east and is one of the biggest new discoveries in this historic district in decades. Metallic Minerals is one of the largest owners of alluvial gold mining claims in the Yukon Territory, including this large block of unmined claims in the Klondike,” he added.
The agreement with Little Flake is effective immediately, with production targeted to begin by June. The companies will be working together closely to ensure a rapid and successful start-up for the partnership.
Under the terms of the Australia Creek property agreement, Little Flake must complete a C$1 million minimum annual work commitment and pay Metallic Minerals an annual advance royalty plus a variable royalty on all gold production.
