The pair announced an agreement in principle regarding a principal operating licence and indemnity agreement (OLIA).

According to the updated feasibility study unveiled in March, the 15-year mine would produce an average annual 220,300 ounces of gold and Glencore's neighbouring Horne smelting facility would process the copper concentrate.

Horne 5 is below the former Horne mine, which was operated by Glencore Canada's predecessor Noranda between 1927-1976 and produced 11.6 million ounces of gold and 2.5 billion pounds of copper.

The latest Horne 5 study estimated initial capex of US$844.2 million, an after-tax NVP5 of $761 million and IRR of 18.9%.

Falco president and CEO Luc Lessard said the agreement in principle was the culmination of an extensive technical and strategic collaboration between Falco and Glencore and he was confident the OLIA would be finalised in the third quarter.

Glencore's global zinc and lead industrial lead Aline Coté and Claude Bélanger, COO of the company's North American copper assets, said copper produced at Horne 5 and processed through Glencore's integrated Quebec Copper Operations would be "some of the greenest and lowest-carbon footprint copper in the world".

"While it is impossible to eliminate all of the risks inherent with having two such operations in close proximity, Glencore is confident that with the work done to date, our strong relationship and the successful completion of the OLIA, an alignment of interests will have been achieved and a path to success for the Horne 5 project will have been set out," they said.

The copper and zinc offtake agreed with Glencore in October would form part of the OLIA, Falco said. 

Falco has a silver stream financing arrangement in place with its largest shareholder, Osisko Gold Royalties.

Falco shares (TSXV: FPC) have traded between C34.5-60c over the past year.

They closed up 7.9% yesterday to 41c, valuing it at $93 million (US$75 million).