Forest Gate to acquire Quebec gold property for about $300K plus royalties

MONTREAL - Resource company Forest Gate Energy Inc. (TSXV:FGE) said Thursday it has a deal to acquire the Pershing gold property located near Val D'Or, Que., from two private gold exploration companies in a deal valued at around $300,000 plus smelter return royalties.

Montreal-based Forest Gate said it is acquiring the property from the two companies, Montigua and Bermont, in return for three million Forest Gate shares and a two per cent net smelter return royalty.

The company's stock was trading in a range of 9.5 to 10.5 cents a share on the TSX Venture market Thursday morning.

A company news release said Forest Gate can purchase one per cent of the royalty at any time, for an undisclosed sum, following the completion of a pre-feasibility study on the property.

Forest Gate also holds a right of first refusal on the sale or reassignment of the remaining one per cent royalty.

A finder's fee of 150,000 Forest Gate common shares will be paid to a consultant upon closing.

Forest Gate Energy Inc. is an oil and gas exploration and production as well as non-energy resource company.