ASX-listed Matsa Resources has executed a A$7-million agreement with fellow-listed diversified miner IGO subsidiary IGO Newsearch, whereby it can earn a 70% interest in Matsa’s Symons Hill nickel project over the next three years.

The project is based in the Fraser Range, in Western Australia, and is highly prospective for nickel and copper. The project is situated 6 km southwest of IGO’s Nova nickel operation.

Matsa has conducted a significant amount of exploration work at Symons Hill and identified anomalous nickel mineralisation during that time.

IGO plans to pay Matsa A$625 000 for a 24-month period, in which IGO will spend A$1.5-million on in-ground exploration. IGO may withdraw within 12 months if it has met minimum expenditure requirements of A$500 000, with the project being returned to Matsa.

Upon IGO electing to continue exploration after 24 months, IGO will then pay Matsa A$1.3-million for a further 12-month period to spend A$2-million on in-ground exploration expenditure.

Upon completion of the 36-month period, IGO can acquire a 70% interest in the Symons Hill project by paying Matsa A$1.5-million.

Should IGO elect to do this, a joint venture (JV) will be formed between the companies, with Matsa retaining a 30% interest and being free carried until completion of a feasibility study or a decision to develop a deposit within the project, whichever occurs first.

Further, Matsa can retain its 30% interest after completion of a feasibility study or a decision to develop a deposit by IGO, by making a contribution to the JV or it can dilute to a 0.75% net smelter return royalty interest.

“The Symons Hill nickel project has been on the backburner for some time with Matsa’s focus on the Lake Carey gold project, but we always maintained it held considerable value.

"I look forward to IGO using their vast knowledge and experience to exploit Symons Hill, while allowing Matsa shareholders to keep an exposure by retaining a 30% joint venture interest. It is worth noting that Matsa controls about 170 km² in its own right within the Fraser Range that is also of high value,” says Matsa executive chairperson Paul Poli.