PERTH (miningweekly.com) – ASX-listed Exterra Resources has terminated the sale of its Linden gold project, in Western Australia, after buyer Fortuna SL Mining failed to deliver a milestone payment.
In April this year, Exterra agreed to divest of its Linden project to Fortuna in a deal valued at A$7-million. The cash consideration was to be paid in tranches, with Fortuna granting Exterra a 2% gross royalty on the mining property, as well as a 1% gross royalty on the Fortitude tenements, which were currently under an option-to-purchase agreement.
Exterra said on Wednesday that a A$150 000 payment from Fortuna had not been received, prompting the miner to terminate the agreement.
Payments made by Fortuna to date, totalling A$125 000, were nonrefundable.
Furthermore, the buyer had already conducted some 2 000 m of aircore drilling at its own costs, the results of which would be reported to market as they became available, MD John Davis said.
“It is disappointing the Linden project sale agreement has been terminated; however, the company is optimistic in seeking an alternative strategy for the Linden project,” Davis added.
Exterra’s focus at Linden had been on the Second Fortune deposit, where a 2014 prefeasibility study revealed that a A$5-million investment could result in the recovery of 56 600 oz, over a mine life of two-and-a-half years.