Photo by: Bloomberg
PERTH (miningweekly.com) – Gold miner Newcrest Mining has signed a non-binding heads of agreement (HoA) with fellow-listed ABM Resources over its Euro project, in the Northern Territory.
The two companies will now negotiate a binding farm-in and joint venture (JV) agreement, under which Newcrest could earn a 75% interest in the Euro gold project.
Newcrest would be able to earn an initial 51% interest in the project by spending A$6-million on exploration within a four-year period. The company could elect to increase its stake to 75% by spending an additional A$6-million on exploration within three years from electing to start the Stage 2 earn-in.
The ASX-listed gold miner could also withdraw from the earn-in after spending a minimum of A$2-million during the Stage 1 earn-in.
Following the start of a JV agreement, ABM could choose to co-fund all future exploration and development work, or dilute its interest in the Euro project and convert it to a 1.5% net smelter profit if the interest is diluted to below 10%.
“Newcrest’s entry into the Tanami region of the Northern Territory supports our belief that this area will yield Australia’s next major gold discoveries,” said ABM MD Matt Briggs.
“Combining our technical skills to direct a major new exploration programme will help accelerate discovery in the region.”
The Euro project covers 3 478 km2 of exploration licence and applications in the Tanami region, and is along strike of the Trans Tanami trend, which is the regional control of major gold deposits in the area.