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Western Areas partners with Gunson, Monax on exploration

9th October 2014

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – Nickel miner Western Areas is advancing its exploration drive by signing farm-in and joint venture (JV) agreements with fellow-listed Gunson Resources and Monax Mining.

Western Areas told shareholders on Thursday that the agreements provided the company with a staged programme to acquire up to 90% interest in a number of key tenements in the Western Gawler region, of South Australia.

The total area under the proposed JV projects covers about 2 746 km2.

“Western Areas has been conducting due diligence on a number of farm-in and JV opportunities over the last six months as part of our regional exploration strategy, and we believe the Western Gawler opportunity offers the significant discovery potential we are looking for,” said MD Dan Lougher.

“Regional exploration sits alongside our Forrestania exploration programme and we have been very clear that with our positive cash flow generation we would look to take first mover style opportunities where the initial investment is relatively low, but the potential rewards are high.”

Under its JV transaction with Gunson, Western Areas could acquire a 75% interest in Gunson’s Fowlers Bay nickel project by spending A$800 000 within two-and-a-half years of the agreement date.

The company could then elect to earn an additional 15% interest in the tenement by spending a further A$400 000 within an additional 18-month period. Following the completion of the Stage 2 spending, a JV would be formed.

Gunson MD Bill Bloking expressed his delight in partnering with Western Areas, saying the nickel miner’s investment in the project validated Gunson’s own view about the prospectivity of its acreage.

The Fowlers Bay nickel project covers about 700 km2.

Meanwhile, under its farm-in with Monax, Western Areas has committed to a minimum expenditure of A$400 000 over a two-and-a-half-year period to gain a 75% interest in the three tenements making up the Western Gawler Craton project. The project area covers some 2 046 km2.

Stage 2 investment in Monax’s tenement would see Western Areas invest a further A$400 000 over the following 18 months, for an additional 15% interest.

Lougher said that the initial work programme at both project areas would consist of detailed airborne geophysical surveys to facilitate the geological interpretations, and to allow for initial target generation.

The company would use data from both Gunson and Monax to discover polymetallic orebodies.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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