West Perth gold mining and exploration company Agincourt Resources Ltd will sell its Brazilian Adorinhas Gold project to fellow West Perth company Troy Resources NL for around $13.2 million.
Troy will purchase all shares in Agincourt's Brazilian subsidiary for an initial payment of US$9.1 million, with an additional US$1 million to be paid after completion of all transfers and approvals.
Agincourt said in an announcement that, while the site had potential for reasonable returns, the capital costs were too high, and did not meet the company's strategic objectives.
The company said it would use funds from the sale to strengthen its cash reserves and enable a greater focus on project development and current exploration efforts.
Completion of the transaction is conditional on the execution of a formal sale and purchase agreement, currently under negotiation.
Troy chief executive Tommy McKieth said the Adorinhas project was a natural addition to his company's existing operations.
"The project is at feasibility stage and with Troy's proven project development capability we intend to fast-track it to production," he said.
