Nedlands-based gold explorer Integra Mining Ltd will sign a farm-in agreement with mining giant Barrick Gold worth $3 million over five years, in exchange for an 80 per cent equity stake in Integra's Oodnadatta Copper-Gold project.
Nedlands-based gold explorer Integra Mining Ltd will sign a farm-in agreement with mining giant Barrick Gold worth $3 million over five years, in exchange for an 80 per cent equity stake in Integra's Oodnadatta Copper-Gold project.
In addition, Barrick has agreed to take up a $1 million placement of Integra shares at a price of 13 cents each, including a two-for-three attaching option, to help Integra progress its 100 per cent-owned, 1.2 million ounce Aldiss-Randalls Gold Project in Western Australia's Eastern Goldfields.
The full text of a company announcement is pasted below
Emerging gold company Integra Mining Ltd has secured the involvement of the world's largest gold producer, Barrick Gold, in the continued evaluation of its Oodnadatta Copper-Gold Project in South Australia for large-scale Olympic Dam-style deposits after today announcing a landmark $3 million Farm-In with Barrick Gold of Australia Ltd.
In addition, Barrick has agreed to take up a $1 million placement of Integra shares at a price of 13 cents each, including a two-for-three attaching option, boosting Integra's working capital to progress its 100 per cent-owned, 1.2 million ounce Aldiss-Randalls Gold Project in Western Australia's Eastern Goldfields.
Barrick commented during technical discussions that they are "impressed with the quality and style of work undertaken by Integra, particularly the 'New Discovery' initiative and that Barrick's investment in Integra will provide exposure to further exploration success, while the attaching options will provide Barrick with the capacity to potentially increase its equity position in Integra at some point prior to November 2009."
The Farm-In with Barrick marks the culmination of work by Integra to advance the Oodnadatta Project, which is located some 400km north-north-west of Olympic Dam within the major G2 Corridor - the same Gawler Craton margin structure interpreted from aeromagnetics and gravity data that hosts the Olympic Dam copper-uranium-gold and Mount Gunson copper deposits.
Earlier this year, Integra commenced a diamond drilling program targeting the Borthanna 'Olympic Dam' target, however the program encountered technical difficulties with the drill rod breakages. At the time, Integra had completed magnetic and gravity data modelling of the Allandale Complex revealing a number of discrete gravity anomalies on the margins of the complex, itself located at the intersection of a regional northeast trending structural zone and the northwest trending G2 corridor. Further evaluation of these anomalies and a ranking of drilling opportunities, including Borthanna, is expected to be Barrick's first task.
Integra has finalised a binding Letter of Intent with Barrick for a farm-in agreement at Oodnadatta, under which Barrick can earn 80 per cent equity in the project by spending $3 million over a 5-year period, with a minimum expenditure commitment of $800,000 in the first 12 months. Integra has elections to contribute or dilute at equity positions of 20 per cent and 10 per cent. Should the Company's interest fall below 5 per cent, its interest will automatically convert to a 1 per cent NSR royalty.
"We are delighted to have secured the involvement of Barrick in the Oodnadatta Project, which will ensure that the project receives the technical and financial resources required to evaluate a number of exploration targets within a much shorter timeframe than Integra could have supported alone," said Integra's Managing Director, Mr Chris Cairns. "We are pleased to have a partner of the calibre of Barrick in South Australia, and we hope that this joint venture may open the door for cooperation on other projects and opportunities."
"This will enable Integra to continue to focus on progressing our flagship Aldiss-Randalls Gold Project, 130km east of Kalgoorlie, with a major drilling campaign about to commence," he added.
Integra has completed a pre-feasibility study on the Aldiss-Randalls Project, which includes a JORC compliant resource of 14 million tonnes at 2.6g/t for 1.2 million ounces, located within a consolidated, dominant regional tenement position. 79 per cent of the resources are within the Indicated category.
The Company has completed a pre-feasibility study on the project based on production of 115,000oz per annum over an initial 4-year mine life. The Company has acquired a 1.35mtpa processing facility with flexible configuration, suitable to underpin project development.
Integra is about to commence a major exploration campaign with the objective of identifying sufficient additional resources to extend the proposed mine life to 5 years. The Company is well funded by a recent entitlement issue and the placement to Barrick is expected to result in the Company having in excess of $5 million in cash reserves.
Barrick is a leading international gold mining company, with a portfolio of 27 operating mines and seven advanced exploration and development projects located across five continents, and a large land position on the world's best exploration belts. Barrick holds a pre-eminent position within the gold mining industry. It also has the largest reserves in the industry, with pro forma gold mineral reserves of 139 million ounces as at December 31, 2005. For 2006, Barrick is targeting gold production of 8.6 million ounces and copper production of approximately 370 million pounds.
