West Perth-based mineral explorer Legend Mining Ltd will allow Oxiana subsidiary Oxiana Exploration Pty Ltd to earn a 75 per cent interest in its Mt Gibson zinc copper and gold project under a joint venture announced today.
West Perth-based mineral explorer Legend Mining Ltd will allow Oxiana subsidiary Oxiana Exploration Pty Ltd to earn a 75 per cent interest in its Mt Gibson zinc, copper and gold project under a joint venture announced today.
Oxiana must provide Legend with $10 million to fund exploration of the site within 7 years, with Legend 25 per cent free-carried to completion of a bankable feasibility study and a decision to mine.
Oxiana must spend $1.2 million within 18 months before having a right to withdraw.
The full text of a Legend announcement is pasted below
Legend Mining Limited (ASX: LEG) today announced that it has signed a Farm-In and Joint Venture letter agreement with Oxiana Exploration Pty Ltd, a wholly-owned subsidiary of Oxiana Limited (ASX:OXR), over its Mt Gibson Project (zinc-copper-gold), which lies 100km south of Oxiana's world-class Golden Grove Mine.
Oxiana may earn 75% interest in the project by funding $10 million of exploration within 7 years, with Legend 25% free-carried to completion of a bankable feasibility study and a decision to mine. Subject to satisfactory completion of due diligence by 31 May 2007, Oxiana must spend $1.2 million within 18 months before having a right to withdraw.
Legend Managing Director Mark Wilson said "Oxiana's Golden Grove knowledge makes them an ideal joint venture partner for Mt Gibson. They are clearly committed to well funded exploration as demonstrated by the recently announced increase in their funding
of exploration and resource development at Golden Grove to $15 million in 2007."
"This deal is great for Legend shareholders and completes our current strategy of ensuring that all our projects are fully active with serious and well funded operators."
"With this and the recently announced sale of the Gidgee Gold Project to Apex Minerals NL (ASX:AXM), Legend is now freed-up to focus our exploration funds and activities on unlocking further value from our highly prospective Gum Creek Project (nickel-copper platinum group element) and emerging Pilbara Project (nickel-copper, zinc-copper, copper-gold)."
Deal Summary
- Oxiana to spend $10 million within 7 years to earn a 75% interest in the project commencing 1 June 2007;
- Legend to be 25% free-carried to completion of a bankable feasibility study and decision to mine;
- A minimum of $1.2 million to be spent within the first 18 months before Oxiana can withdraw;
- Each party has a first right of refusal over the sale of all or part of the other party's joint venture interest;
- The 1 million tonne per annum plant and single mens' camp is excluded from the joint venture;
- Legend will remain responsible for the historical environmental liability until Oxiana has earned its interest;
- Subject to a period of Due Diligence until 31 May 2007;
- The letter agreement will legally bind Oxiana and Legend until such time as it is replaced by a formal Farm-In and Joint Venture Agreement.
