The company will pay $60,000 to North Atlantic Mining Associates (NAMA) for a two-month option to enter into an earn-in deal with NAMA over exploration concessions held by its subsidiary NAMA Greenland (NGL) at Thule, Greenland.
During this two month period, Red Rock will carry out further due diligence, while NAMA will carry out preparatory work for the exploration program.
Red Rock may exercise the option by making payment of $250,000 (or issuing an equivalent value of Red Rock ordinary shares), upon which it will enter into the earn-in and be obligated to fund the 2011 exploration program.
This exploration program is expected to include airborne geophysics, drilling, and the definition of a JORC or equivalent resource.
Upon fulfilment of the program, Red Rock will be entitled to a 25% interest in NGL.
Red Rock may elect to earn a further 35% interest in NGL by making a further payment of $250,000 and funding the 2012 exploration program, also to include definition of a JORC or equivalent resource.
The agreed aggregate cost of the 2011 and 2012 exploration programs is $5m, exclusive of taxes.
