Sinclair Gold Signs $3.4m Earn-In Deal with Medaro for Sala Project

Binding Earn-In Agreement Advances Sala Project Ownership

Sinclair Gold Ltd (ASX:SGC) has formalised its partnership with Medaro Mining Corp. (CSE: MEDA) through a binding earn-in agreement for the Sala silver-zinc-lead project in Sweden’s Bergslagen district. This deal supersedes the non-binding letter of intent from May 2026 and sets a clear pathway for Medaro to earn up to 100% ownership of the Sala Project via staged cash payments, share issuances, and exploration commitments.

The total consideration package could reach approximately A$3.4 million, combining up to A$1.3 million in cash, 1.2 million Medaro shares valued at around A$300,000, and A$1.75 million in exploration expenditure funded by Medaro. Sinclair will maintain exposure to Sala’s future upside through a net smelter return royalty starting at 1%, escalating to 2% if Medaro acquires full ownership.

Joint Venture Structure and Earn-In Stages

The agreement establishes a joint venture entity incorporated in Sweden, initially split 50-50 between Sinclair and Medaro. Medaro’s path to full ownership unfolds in stages: first securing a 50% interest by fulfilling initial exploration expenditure and payments; then increasing to 90% by further exploration and payments; and finally acquiring the remaining 10% through additional cash and share consideration.

Medaro will operate and manage the joint venture, with Sinclair’s interest free-carried until a mineral resource estimate compliant with NI 43-101 standards is delivered. Governance provisions allow Sinclair to retain board representation proportional to its ownership, ensuring ongoing involvement as Medaro advances the project.

Strategic Focus on Mt Henry Gold Project

Sinclair plans to deploy the funds received from Medaro towards exploration activities at its flagship Mt Henry Gold Project in Western Australia, which hosts an existing mineral resource of 915,000 ounces of gold. The company has been actively expanding this resource with a substantial drilling campaign, positioning Mt Henry as its core growth asset. This capital injection from the Sala deal supports Sinclair’s strategy to prioritise Mt Henry while retaining upside in Sala through royalties.

Chief Executive Jeff Sansom emphasised that Medaro’s expertise is well suited to unlock Sala’s potential, allowing Sinclair to maintain exposure without diverting focus from Mt Henry. The deal is subject to regulatory and third-party approvals in Sweden and Canada, with completion anticipated before the fourth quarter of fiscal 2027.

Regulatory Approvals and Transaction Conditions

The transaction hinges on several regulatory clearances, including approvals from the Swedish Inspectorate of Strategic Products and the Mining Inspectorate of Sweden, as well as securities regulatory requirements in Canada. Sinclair shareholder approval is not required, streamlining the process. Either party may withdraw if conditions are unmet within seven months of filing.