Quaterra Resources Inc. and its subsidiary Singatse Peak Services announced earlier this week that they had reached an agreement with Freeport Nevada to extend for up to two years the current Stage 2 of Freeport Nevada’s option to acquire an interest in the company’s Yerington Copper Project in Nevada. Gerald Prosalendis, recently appointed president and COO of Quaterra Resources, explains what this extension means for Quaterra and the Yerington project.
The Gold Report: What does the agreement you just announced to extend Freeport-McMoRan Nevada LLC’s (Freeport Nevada’s) option to acquire an interest in Quaterra Resources Inc.’s (QTA:TSX.V; QTRRF:OTCQX) Yerington Copper Project in Nevada really mean?
Gerald Prosalendis: It means the funding is available to secure the land position, maintain operations and, under the right circumstances, continue drilling at the Yerington Copper Project. To achieve this, Quaterra and Freeport Nevada are extending by two years a four-year option agreement that allows Freeport Nevada to earn an interest in Quaterra subsidiary Singatse Peak Services (SPS), which holds all the Yerington project assets. The extension requires Freeport Nevada to make option payments to SPS of $5.75 million over two years.
TGR: What are the precise terms of the extension?
“Quaterra and Freeport Nevada are extending by two years a four-year option agreement that allows Freeport Nevada to earn an interest in Quaterra subsidiary Singatse Peak Services.”
GP: To extend the current stage of the option agreement, Freeport Nevada must make at least four option payments over two years totaling $5.75 million, one every six months starting this month. The first option payment received on June 13 was for $1.8 million. The second option payment, due in December 2016, is for $1.25 million. There are also third and fourth payments of $1.35 million each. Freeport Nevada has the right to terminate the agreement at any time …read more