05/10/2018 - 11:39

Doray in $10m Andy Well sale

05/10/2018 - 11:39

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Gold miner Doray Minerals has announced the sale of its mothballed Andy Well project near Meekatharra to Canadian company Galane Gold in a deal worth $10 million.

Doray in $10m Andy Well sale
Andy Well produced about 300,000 ounces between 2013 and 2017.

Gold miner Doray Minerals has announced the sale of its mothballed Andy Well project near Meekatharra to Canadian company Galane Gold in a deal worth $10 million.

Under the deal, Toronto-listed Galane will pay $9 million in three cash payments over the next two years, along with $1 million worth of shares.

Andy Well was placed on care and maintenance in November last year, having produced about 300,000 ounces between 2013 and 2017.

The project holds a mineral resource of 500,000oz.

Doray managing director Leigh Junk said Andy Well had provided shareholder value for the company.

“With the company’s successful establishment of Deflector as a profitable foundation from which to drive shareholder value, this transaction with Galane provides us with a well-structured exit from Andy Well and the opportunity for the project to prosper once again under new ownership,” he said.

“In addition to the upfront and milestone payments and assumption of the Andy Well rehabilitation liabilities by Galane, Doray shareholders will benefit from any upside through the proposed farm-in agreement over the prospective Gnaweeda area.”

The deal is subject to a number of conditions, including regulatory approval.

Doray also said it had reached a non-binding agreement with Galane to farm-out the Gnaweeda project, which is located near Andy Well, with a binding agreement currently being finalised.

Doray was advised by PCF Capital. 

Shares in Doray were up 1.45 per cent at 35 cents each at 1.15pm AEDT.

 

 

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