EAG stock price rallied 23% today under a trading volume of 2.1 million, which was more than eight times heavier than the daily average of 251 thousand.
Eagle announced today that the company decided to exercise their option allowing to purchase 75% interest in the Windfall Lake Property in Quebec. The company had the option agreement since July 20, 2009. It was granted by Noront Resources Ltd.
Eagle Hill has already completed the initial payments required for the option to be exercised. Both companies are currently in discussion trying to finalize the steps necessary to obtain the interest.
Eagle Hill will have one year, counting from April 20, 2012, to complete a feasibility study that would show an internal rate of return on the property of at least 15% or commit and start commercial production from the property. Failure to deliver under these conditions would allow the current optionor to repurchase the 75% interest, paying Eagel either the expenses incurred or $6 million depending on which amount would be less at the time.
Eagle will also have to enter into a joint venture with Noront.