Queenston Mining has signed an agreement with Kirkland Lake (KL) Gold to sell its 50% stake in the assets held by a joint venture formed by both companies, for total consideration of $60m.

The all-cash deal, which is subject to several stipulations prior to conclusion, is likely to be finalized by 3 December 2012.

Under the terms of the agreement, KL Gold will make a non-refundable cash payment of $10m on signing as well as $20m cash on closing, and remaining cash due by the first week of December this year.

Queenston will also receive a royalty on some amount of gold produced from the sold properties.

Queenston Mining president and chief executive officer Charles Page said the sale of this non-core asset provides the company with funds to progress the Upper Beaver project towards advanced exploration and feasibility.

"The recent positive PEA on the project, based on constructing a 2,000t a day, stand-alone mine-mill operation, outlines robust economics with annual production of 120,000oz of gold and 5.3 million pounds of copper," Page added.