PERTH (miningweekly.com) – Gold miner Regis Resources has struck a A$10-million deal with fellow-listed Stone Resources to acquire the Ben Hur gold project, in Western Australia.
Under the terms of the agreement, Regis would pay A$10-million worth of its own shares, priced on the basis of the five-day volume weighted average price prior to the completion of the transaction, to Stone Resources, along with a 1% net smelter royalty after the production of the first 100 000 oz of gold from the royalty tenement.
The net smelter royalty will be capped at A$5-million, after which the royalty would revert to a 0.0025% net smelter royalty for a period of four years.
The transaction is subject to a number of conditions, including shareholder and Ministeral approval.
The Ben Hur project is made up of two exploration licences, three prospecting licences and one miscellaneous licence, as well as three mining leases. The project is estimated to host some 5.8-million tonnes of resource, grading 1.6 g/t gold for 290 000 oz of contained gold.
Regis told shareholders on Wednesday that the acquisition of the Ben Hur project had the potential to add further life to the Duketon operations, and would expand the ongoing Duketon greenstone belt exploration programme.
“The acquisition of this resource and tenement package is significant to us. The deal will enable Regis to potentially add the Ben Hur deposit to the Duketon operation production portfolio,” said Regis MD Jim Beyer.
“At the same time, the exploration tenure acquired with the Ben Hur deposit has the potential for additional ounces to be discovered and added to our already substantial resource and reserve holdings. We are very excited by the potential for exploration success and I look forward to keeping investors informed as we move forward on these tenements.”
Stone Resources told shareholders that the divestment of the Ben Hur project was an important step in the company’s recapitalization process, and would allow the company to advance the development of its Brightstar gold project, in Western Australia.