PERTH (miningweekly.com) – ASX-listed PNX Metals has inked a non-binding term sheet with Halifax Capital and its subsidiary Bridge Creek Mining (BCM), which could spur the development of the Fountain Head gold project, in the Northern Territory.
Under the terms of the agreement, BCM could provide a capital investment of A$40-million to fund the acquisition, construction and commissioning of a fit-for-purpose carbon-in-leach processing plant and associated infrastructure for the gold project.
The two companies would then form an unincorporated joint venture to mine and process the mineral resources at Fountain Head and to share the gold produced on a 50:50 basis, with agreed direct operating costs to be paid by PNX and BCM in the same proportion.
Fountain Head hosts a Joint Ore Reserves Committee-compliant resource of some 156 000 oz.
“Through the proposed JV, the company would have a clear path to monetize the Fountain Head gold resource and certainty around a funding solution that minimizes dilution for PNX shareholders and significantly de-risks the project,” said MD James Fox on Wednesday.
“Halifax and BCM are motivated and experienced partners and their involvement as initial owners and experienced operators of the project infrastructure will allow PNX to focus on generating a pipeline of additional gold resources for processing through regional exploration within its significant tenure in the Northern Territory.”
BCM director Joseph Mills said the deal set a good foundation for both groups and a clear pathway to capitalise on the strengths in the gold market for years to come.
“The opportunity also allows the JV to establish a key piece of infrastructure in the area to not only service our pipeline, but other companies that have stranded assets that haven’t been able to access a gold mill. We will be engaging closely with local indigenous and non-indigenous contractor groups for the creation of new jobs, both directly and indirectly, throughout the life of the projects,” said Mills.