"Our team has been following this asset for over eight years and began serious negotiations almost a year ago after the sale of Santa Gertrudis to Agnico Eagle Mines for total proceeds of US$95 million. With this new agreement in place, we can continue exploring this project and test our belief that a large-scale high-grade system exists," said president and CEO Brad Langille.

Los Ricos, about 100km north-west of Gaudalajara, is made up of 29 claims, covers over 22,000 hectares and is home to several historical mining operations. There are 65 historical drill holes on the property and the majority intercepted mineralisation from near surface.

Under the option agreement, GoGold will make staged payments totalling over $1.5 million over five years plus provide a 2% net smelter returns royalty on five of the concessions. If it decides to exercise the option, a lump sum payment not to exceed $11 million can be made at any time within the option period.

The exploration and development of Los Ricos has been delayed in the pat due to litigation. In 2016, the courts awarded title to the property to the private Mexican owners that are optioning it to GoGold. Several recent court decisions have dismissed appeals that challenged the 2016 decision.

GoGold operates a silver and gold tailings reprocessing operation at Parral in Chihauhua, Mexico.

Its shares (TSX:GGD) are trading at C$0.27 valuing the company at $46 million.