PERTH (miningweekly.com) – ASX-listed Antipa Minerals has inked a A$30-million farm-in agreement with metals miner Independence Group over the Paterson project, in Western Australia.
Under the farm-in agreement, Independence could earn a 70% interest in a joint venture (JV).
An initial A$4-million will be spent on the farm-in area within the first two-and-a-half years of the start of the farm-in, with no less than 75% of this directed towards in-ground activities.
Antipa will manage the initial period of exploration, and will receive a management fee of 10% on all eligible expenditure incurred in that period. At the end of the initial period, Independence could elect to withdraw from the farm-in or to continue with its earn-in.
Independence would be required to spend a further A$26-million on exploration within a further six-and-a-half-year period, to earn its 70% interest. This earn-in period can be extended for up to two years in aggregate, as a consequence of a force majeure event.
During this stage of the earn-in, Independence could elect to become the project operator, and can elect to withdraw from the farm-in at the end of any programme and budget during this stage, in which case Antipa would retain full ownership of the project.
Upon earning a 70% interest the two parties would form a JV under which Antipa will be free-carried until the completion of a feasibility study. If Antipa does not elect to participate in a decision to mine, Independence would be entitled to buy out Antipa’s interest in the project for fair market value, or this interest could be sold to a third party.
In addition to the farm-in agreement, the two companies have also inked a subscription agreement which would see Independence acquire a 4.9% take in Antipa, priced at 2.75c a share for a total investment of A$3.62-million.
Independence MD Peter Bradford on Thursday said that the company was pleased to be adding the Paterson project to its portfolio of projects in the Paterson copper/gold province.
“We look forward to working closely with Antipa to realise discovery success at the Paterson project over the next few years.
“Independence is also pleased to become a shareholder of Antipa, given Antipa’s outstanding pipeline of projects at various stages of exploration across the Paterson region. Antipa has assembled an impressive list of exploration partners and we are excited to be one of them.”
Antipa executive chairperson Stephen Power said that the transaction with Independence was the company’s third major farm-in agreement, following similar deals with majors Rio Tinto and Newcrest Mining, and provided validation of the company’s efforts to build a strategic landholding in the Paterson Province at a time when the region’s geological potential was not as keenly appreciated.
“We are now looking forward to continuing exploration on this ground, increasing our understanding around the existing resources and, at the appropriate time, considering potential development scenarios,” he added.