Photo by: Bloomberg
PERTH (miningweekly.com) – ASX-listed junior Brumby Resources has signed an earn-in option agreement with diversified Canadian miner Teck Resources to explore for zinc at Brumby’s McArthur River tenements, in the Northern Territory.
Brumby said on Monday that Teck would take about 25-million Brumby shares, at a price of 2c each, providing the company with a A$500 000 capital injection.
Teck could earn a 70% interest in the McArthur River project by spending a minimum A$3.5-million on exploration before the end of June 2018, with a minimum of A$500 000 to be spent before mid-2015.
Once Teck has acquired this majority interest, the two companies would form a joint venture entitling Brumby to a 1.5% net smelter royalty on production from the McArthur River project.
The initial A$500 000 capital investment would be subject to Brumby obtaining the remaining 20% interest in the exploration licence covering the McArthur River tenements fro Arnhem Resources, in exchange for five-million shares in Brumby.
If the company is unable to obtain this outstanding shareholding by the end of June this year, Teck had the right to terminate the earn-in agreement.