Mining News Pro - Canadian miner Pacton Gold has entered into a binding letter of intent with ASX-listed Clancy Exploration over the Hong Kong project, in the Pilbara.

According to Mining News Pro -Under the letter of intent, Pacton would acquire a 70% interest in the Hong Kong project for a total of C$1.7-million, comprising a C$25 000 non-refundable deposit, a C$175 000 payment on completion of the transaction, and Clancy receiving C$1.5-million worth of Pacton shares, based on a ten-day volume weighted average price of Pacton shares.

On the completion of the acquisition, the two companies will enter into a joint venture, with Pacton acting as operator.

The Canadian firm would be required to spend a minimum of C$500 000 on Hong Kong within two years of the transaction, with Clancy to be free carried until a decision to mine is unanimously made.

This is an excellent deal for Clancy. Pacton are aggressively exploring the Pilbara for gold, having accumulated a very significant land package in the region, and Pacton will be an excellent partner for Clancy on Hong Kong,” said Clancy chairperson David Lenigas.

“The deal will allow Clancy to focus on its new and exciting Morrocan cobalt strategy,” Lenigas added.

Pacton is currently the third-largest land holder in the Pilbara, owning 492 km2 of exploration tenements in the region.