PERTH (miningweekly.com) – Gold miner Regis Resources has completed a A$25-million sales agreement with fellow-listed Duketon Mining to acquire a package of tenements around its own Duketon gold project, in Western Australia.
Regis on Monday announced that it would acquire 35 tenements, of which 32 are granted exploration licences, while three have pending exploration licences. Regis will also acquire the gold rights on the M38/1252 tenement, of which Duketon would maintain ownership.
In addition to this tenement, which hosts some 71 000 t of nickel metal resources, Duketon would also retain nickel rights over five other tenements.
With the acquisition of the Duketon tenements, Regis now controls 90% of the gold rights in the Duketon Greenstone belt, tripling its landholding to around 3 000 km2.
Regis MD Jim Beyer noted that the considerable expansion of the company’s landholding around its three mills provided a tremendous opportunity to invest in further exploration to expand the resource base and extend the mine life of its Duketon operations.
“Being able to accelerate greenfield exploration in an area which has previously been underexplored and is host to major shear zones and the extension of our existing orebodies, is an immediate opportunity for the company. We are very excited to be able to apply our knowledge of the mineralisation and deposits at Duketon to work toward further exploration success.”
Under the terms of the agreement with Duketon, Regis made a A$20-million cash payment, with a further A$2.5-million payable on the achievement of a mineral resource greater than 250 000 oz on one ore more of the sales tenements.
A further A$2.5-million will become payable on either the first commercial gold production, or the mining of more than 5 000 oz of gold from the sales tenements.
Duketon MD Stuart Fogarty told shareholders that the transaction would allow the company to focus its efforts on maximizing the value of the known nickel resources and to continue the exploration of its highly prospective nickel tenure.
“Realising the nickel potential of the region was the primary objective of the company at its initial public offering, and has always remained a significant value driver for shareholders.
“This deal significantly reduces our ongoing tenement holding costs. Outside of M38/1252 in the areas of nickel rights, we have zero holding costs but retain 100% access to explore for nickel and in the event of a discovery, establish mining operations.
“This allows us to be in the unique position of being able to execute our exploration programmes without being driven by the underlying tenement expenditure conditions.”