PERTH (miningweekly.com) – Copper miner Sandfire Resources has entered into agreements to acquire an 85% interest in the Red Bore copper project, adjacent to its own DeGrusssa mine, in Western Australia.
The Red Bore comprises a 2 km2 granted mining lease and was previously subject to a joint venture agreement between ASX-listed Ora Gold and William Richmond.
Under the terms of the agreement, Sandfire will now make a cash payment of A$1.25-million to Richmond, and would grant him a 1.25% net smelter royalty over the minerals produced at the Red Bore project.
Upon a decision to mine, Ora Gold will have a put option to sell its remaining 15% interest in the project, and if the company elects not to exercise this option, Sandfire will continue to cover Ora Gold’s share of any cash call by way of an interest-free loan repayable from 75% of Ora Gold’s free cash flow from its share of minerals produced at Red Bore.
Sandfire MD Karl Simich told shareholders on Friday that the agreement with Ora Gold and Richmond consolidated ownership of the strategically located tenement.
“The Red Bore project will be incorporated within our near-mine exploration programmes at DeGrussa and explored using our leading geochemical and geophysical exploration methodologies.”