Pacton Gold (CVE:PAC) (OTCMKTS:PACXF) announced Friday that it had raised C$2.7 million and struck a partnership with GoldSpot Discoveries Inc to push forward its Red Lake property in Ontario.
GoldSpot is a technology company that leverages artificial intelligence to reduce capital risk to increase efficiencies and success rates in resource exploration.
Vancouver-based Pacton's Red Lake claims lie between Pure Gold Mining's Madsen property, including the Wedge Zone, and Great Bear Resource's Dixie discovery, where recent drill results reported 190.8 g/t gold over 5.9 metres, including 1,600 g/t gold over a drill width of 0.7 metres.
Under the terms of the deal with GoldSpot, the technology company will participate in Pacton’s non-flow-through offering for a total of $1 million in exchange for a 0.5% net smelter return royalty on Pacton’s Red Lake property. GoldSpot also has an option of purchasing an additional 0.5% royalty for $1 million, and a 0.5% royalty on Pacton’s Australian tenements, also for $1 million.
Pacton has engaged GoldSpot for an 18-month period to assist in evaluating and identifying possible areas of mineralization and drill targets on the property. A team of 25 geologists and data scientists will be deployed to stitch, level, and reinterpret geological data in the public domain and marry it with Pacton’s own data and use artificial intelligence to identify patterns and areas with a high chance mineralization.
"Exploration progress to date at Pacton's Red Lake gold project has been very positive and we are looking forward to ramping up activity in partnership with GoldSpot,” said Dale Ginn, Pacton’s executive chairman in a statement.
“The combination of our technical team's experience and GoldSpot's advanced, proprietary technology, significantly enhances the potential for a gold discovery at Red Lake."
New funds raised
The $2.7 million raised is through a combination of common and flow-through shares, Pacton said in a release Friday. Flow-through shares are a unique investment vehicle in Canada allowing investors to gain tax breaks for junior resource financing.
In the first tranche of the non-flow-through offering, the junior explorer issued 17.3 million shares at $0.10 per share for a total of just over $1.7 million. An additional 8.3 million flow-through shares were offered at $0.12 per share, for total proceeds of nearly $1 million.
The company plans to raise $5 million in total from a combination of common and flow-through shares.
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