The company’s joint venture (JV) partner, Entree Gold has also agreed to divest its 40% interest in E28/1915 to Parmelia on the same terms.
As per the agreement, Parmelia has been granted a six month option period by Black Fire and Entrée to conduct certain due diligence over the tenement.
Parmelia has agreed to pay an amount of $12,957 as an option fee to cover the 2014 annual Department of Mines and Petroleum (DMP) license fee, in return for the six month option period.
After expiry of the option period, the company can either withdraw from the agreement or elect to proceed with the acquisition by issuing up to 12 million fully paid ordinary shares in Parmelia at a deemed price of 2.5 cents per share for deemed total consideration of $300,000.
Any shortfall by Parmelia will be met by a cash contribution for a combined cash and scrip consideration of $300,000.
The consideration will be divided proportionately between Black Fire and Entrée Gold.
Black Fire considers that the disposal of its stake in the Mystique project is in the best interests of shareholders and leaves the company better positioned to focus on its interest in the Pilot Mountain Tungsten Project in Nevada, US, whilst retaining the benefit of any equity.
