PERTH (miningweekly.com) – Gold miner St Barbara has struck an earn-in and joint venture (JV) agreement with fellow-listed Australian Potash over the Lake Wells project, in Western Australia.
Under the terms of the agreement, St Barbara will pay A$1.25-million in cash and will spend a minimum of A$1.75-million over an initial 12-month period.
After the first earn-in, St Barbara could elect to earn a 70% interest in the tenements by spending a further A$3.5-million on exploration over the following 24 months, and reimburse Australian Potash up to A$500 000 in costs previously incurred on exploration at Lake Wells.
Australian Potash will retain full ownership of all potash mineral rights at the Lake Wells project, while its 30% interest in the asset will be free carried until the completion of a bankable feasibility study.
“This strategic intent of the board of Australian Potash is to focus on the completion of a definitive feasibility study into the development of the Lake Wells sulphate of potash project. At the same time, however, we have always been very aware of the inherent value of the Lake Wells gold project,” said MD Matt Shackelton.
“We are looking forward to building our relationship with St Barbara. I am confident that we now have the right people, right companies and right project area in place to generate some significant success at what is one of the state’s very prospective and important mineral regions.”
St Barbara told shareholders on Monday that its investment in the project was aligned with the company’s strategy of targeted investment in early to advance-stage exploration through earn-in and JVs, or direct equity investments.