Darnley Bay Resources Ltd. announced Oct. 20 the signing of a letter of intent to acquire Tamerlane's Pine Point assets 42 kilometers (26 miles) east of Hay River, Northwest Territories out of receivership.

Home to the historical Pine Point Mine, this property hosts 42 known zinc-lead deposits over a strike length of approximately 68 kilometers (42 miles), 10 of which have zinc-lead resources that meet NI 43-101 standards and are included in a technical report prepared for Tamerlane in 2014.

Several of the remaining 32 deposits have historical resources, which make them potential additions to a long term mine plan, according to the report. Darnley Bay has agreed to pay an initial fee of C$50,000 and issue 1.15 million common shares to KSV Koffman Inc., which is acting as the court-appointed receiver of Tamerlane and Pine Point Holding Corp. for the option to purchase the property.

To acquire full ownership, Darnley Bay must pay an additional C$2.95 million and issue 23.85 million shares by Jan. 22, 2017.

KSV Koffman will re-distribute the shares so that no new Darnley Bay shareholder holds more than 19.9 percent of the company's outstanding shares.

"This acquisition is a game-changer for Darnley Bay and puts us on a clear path towards production," said Darnley Bay President and CEO Jamie Levy. "It is rare in the mining business that the opportunity to acquire an entire mining district presents itself."

Darnley Bay intends to begin a preliminary economic analysis immediately upon closing.

-SHANE LASLEY