TORONTO (CP) -- De Beers Canada has signed an option agreement with Pure Gold Minerals Inc. to develop De Beers's Courageous Lake property in the Northwest Territories, the diamond mining company said Monday.
The 143-square-kilometre property consists of 14 mineral claims and is 243 kilometres northeast of Yellowknife.
Pure Gold must spend C$1.2 million on exploration of the property over four years to earn an 85 per cent interest, with a minimum of C$150,000 in the first year.
If a discovery is made and a feasibility study indicates the existence of a deposit over a certain value threshold, De Beers has the option to buy back a 70 per cent interest.
For projects below the threshold, Pure Gold will be the operator.
''The property at Courageous Lake has yielded positive results and we are confident that Pure Gold has the expertise and resources to successfully discover the source of these results,'' De Beers president-CEO Richard Molyneux said in a release.
Pure Gold [TSX:PUG] is a diamond and gold exploration company. Its shares were up half a cent to six cents on the Toronto Stock Exchange early Monday afternoon.
(c) The Canadian Press 2005