Canadian junior mining company Troilus Gold has agreed to sell its non-core Mike Lake project (ML property) located in Yukon, Canada to Prospector Metals.

As consideration, Troilus Gold will be issued 8.6 million shares of Prospector Metals, which translates to a stake of 19.9% in the latter, along with a milestone payment of up to C$20m ($15m).

The deal is expected to help Troilus Gold streamline its portfolio of properties. It will enable the company to fully concentrate on the development of its flagship Troilus gold project located in Quebec, Canada while sustaining a stake in the potential success of the Mike Lake project under Prospector Metal’s leadership.

Troilus Gold acquired the Mike Lake claims through the reverse acquisition of Pitchblack Resources in late 2017, concurrently acquiring the historically producing Troilus gold project. The Mike Lake project comprises 319 mineral claims, spanning approximately 6,600ha, situated roughly 80 kilometers northeast of Dawson City.

Prospector Metals CEO Rob Carpenter said: “The ML Property stands out as an exceptional opportunity for multiple reasons. Firstly, it’s rare to have a property host so many highgrade, undrilled surface occurrences within such a fertile environment.

“Secondly, our knowledge base of gold deposits in Yukon has grown so much since the last time the ML Property was worked in 2008.

“Large deposits like Golden Saddle, Coffee and Snowline were discovered after 2008 and our technical team is eager to view the ML Property through a more modern exploration lens.”

Following the completion of the proposed transaction, Prospector Metals plans to promptly initiate exploration activities at the Mike Lake project.

This will involve building upon the positive findings of the initial exploration work carried out intermittently between the mid-1970s and 2008, revealing encouraging indications of substantial mineralisation.

Troilus Gold CEO and director Justin Reid said: “We are very pleased with this agreement, and believe Rob Carpenter and his team are perfectly suited to unlock the potential of these prospective claims.

“Outstanding recent discoveries such as Snowline Gold’s Rogue Project and Victoria Gold’s Eagle Mine, the largest gold mine in Yukon’s history, are located on trend with Mike Lake and underscore the excellent potential in this district.

“As a large shareholder in Prospector Metals, Troilus and its shareholders will benefit from their expertise in this region and the advancements and future milestones achieved at the project.”

The completion of the transaction is contingent on Prospector Metals successfully conducting a simultaneous equity financing, generating total proceeds of at least C$1m.