Alicanto signs $14m earn-in deal

Shares in gold hopeful Alicanto Minerals have surged on news the company has signed a $US10 million ($A14 million) earn-in agreement with Canadian mining giant Barrick Gold for its Arakaka project in Guyana.

Under the deal, Barrick will spend $US8 million in exploration costs over four years and pay $US2 million in cash to earn up to a 65 per cent interest in Alicanto’s Arakaka gold project, at which point a joint venture will be formed.

The two companies will then be required to each contribute further exploration and feasibility costs on a proportional basis for Alicanto to retain a 35 per cent stake.

Alicanto shares were up 86 per cent to 8 cents each at 9:45am.

“Considering Barrack’s strict investment criteria in both quality of people and size potential of projects, I am pleased Barrack has recognised not only the gold endowment potential of the Arakaka project, but also the technical capability of our team, and the contribution we can make,” Alicanto managing director Travis Schwertfeger said.

“We believe it’s a testament to the potential of the project and a credit to the company that Alicanto has been selected as Barrick’s vehicle for initial entry into exploration of the Guiana shield.”

The Arakaka project is a one-hour drive away from port facilities at Port Kaituma, and is supported by an establishment camp.