Following the execution of a letter of intent back in February, CanAlaska Uranium Ltd (TSXV: CVV) and Fjordland Exploration Inc. (TSXV: FEX) entered this week into an option agreement which allows the latter to earn up to an 80% interest in CanAlaska’s North Thompson nickel project in Manitoba, Canada.
In a press release, the companies involved in the transaction said that to go ahead with it, the buyer has to incur in exploration expenditures of $9 million and issue 8.5 million common FEX shares. Other considerations include the payment of a feasibility bonus that requires Fjordland to issue 10 million common shares upon completion of a positive feasibility study.
The work commitments and payments are to be done in three defined earn-in stages. During Stage 1 and Stage 2 of the option agreement, CanAlaska will receive fees as the operator of the project.
The North Thompson property is located approximately 25 kilometres from the city of Thompson and contains a series of high-grade nickel drill intersections from historical work that warrant follow-up with modern geophysics and drilling. According to CanAlaska, there are also numerous untested targets.
“The Thompson Nickel Belt is the fifth largest sulphide nickel belt in the world based on contained nickel endowment, containing over 18 nickel deposits and over 5 billion pounds of nickel production since 1959,” the media brief states. “The largest deposit is the main Thompson Mine at an estimated 150Mt at an average grade of 2.3% nickel. The North Thompson Project covers much of the north and north-western extension of this belt.”