Black Fire Minerals (ASX: BFE) has executed an Option and Sale Agreement with Parmelia Resources (ASX: PML) over its 60% interest in the Mystique Gold Project within the Albany-Fraser Range region of Western Australia.
Black Fire's joint venture partner Entrée Gold has also agreed to divest its 40% interest to Parmelia on the same terms.
Under the terms of the agreement, Parmelia has been granted a six month Option period to conduct certain due diligence in return for $12,957 as an option fee to cover the 2014 annual Department of Mines and Petroleum licence.
At the expiry of this Option period, Parmelia can either withdraw from the agreement or elect to proceed with the acquisition by issuing up to 12 million shares at $0.025 cents for a deemed total consideration of $300,000.
If Parmelia is unable to issue the full 12 million shares, then any shortfall will be met by a cash contribution for a combined cash and scrip consideration of $300,000.
The consideration will be divided proportionately between Black Fire and Entrée.
Black Fire's disposal of its interest in Mystique frees the company to clearly focus on its interest in the Pilot Mountain Tungsten Project in Nevada, U.S., whilst retaining the benefit of any equity upside in Parmelia should they achieve success at Mystique.
Black Fire is modestly capitalised at around $2 million.
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