West Melville Iron Company Ltd. has just entered into a joint venture with Roche Bay plc to buy up to 70% interest in and to the West Melville Iron Ore Project (previously called Fraser Bay 1-3 by Roche Bay plc) located west of Melville, Nunavut.
Some of the key details of the agreement include the following earn-in thresholds: 30% interest for min. of 1,200 m of drilling by Sept. 2012; 60% interest in min. of 10,000 m and PEA by Dec 2014; 70% interest for completing a Feasibility Study on the property; and Roche Bay carried out completion of the Feasibility Study.
West Melville Iron Ore Company Ltd. will manage the property. Roche Bay plc will receive 10% ownership of West Melville Iron Ore Company once Stage 1 is complete, and will retain a 0.5% Gross Overriding Royalty on the project.
Should West Melville Iron Ore Company Ltd. receive an offer for the project at a $100 million or greater valuation, it can require Roche Bay plc to sell its stake in the property on the same terms as the offer.