March 14, 2013: Montreal, Quebec – Stornoway Diamond Corporation (Stock Profile – TSX:SWY) has entered into option agreements with 0954506 B.C. Ltd., a private company controlled by Eira Thomas, formerly a director of Stornoway, relating to Stornoway’s interest in each of the Qilalugaq, Pikoo and Timiskaming exploration projects. Under the terms of the option agreements, the optionee will acquire an 80-per-cent interest in each of the Qilalugaq, Pikoo and Timiskaming exploration projects upon completion of a defined exploration program specific to each project.
The option work programs will be financed and operated by the optionee. Stornoway retains a one-time back-in right to reacquire a 20-per-cent interest in each project, thereby increasing its interest to 40 per cent, by paying the optionee an amount equal to three times the cost incurred by the optionee in connection with the project-specific option work program. Stornoway has a 100-per-cent interest in each of these projects; the Qilalugaq project is subject to a 3-per-cent net smelter returns royalty on metals produced and a 3-per-cent gross-overriding royalty on the sale of industrial minerals, including diamonds.
Matt Manson, Stornoway’s president and chief executive officer, commented: “This option agreement allows us to move these promising exploration projects forward while allowing our management team to focus on the development of the Renard diamond project, our core asset. The bulk sample program at Qilalugaq, for which an inferred mineral resource of 26 million carats was declared by Stornoway in June, 2012, is designed to recover a large enough parcel of diamonds for a preliminary valuation and economic assessment. The Pikoo and Timiskaming work programs are designed to test for the presence of kimberlite with economic potential. At the end of each program Stornoway and the Optionee will be well placed to make a determination on whether to advance each project further within a joint venture, if results warrant.”
To read more about the agreement – CLICK HERE.