04/02/2016 - 11:47

Malagasy buys gold project

04/02/2016 - 11:47

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Soon-to-be renamed Malagasy Minerals has welcomed Regis Resources as a substantial shareholder as the company completes its acquisition of the Karlawinda gold project near Newman, while also announcing the appointment of local gold mining executives to its board.

Malagasy buys gold project
Malagasy has acquired the Karlawinda project through the purchase of private company Greenmount Resources.

Soon-to-be renamed Malagasy Minerals has welcomed Regis Resources as a substantial shareholder as the company completes its acquisition of the Karlawinda gold project near Newman, while also announcing the appointment of local gold mining executives to its board.

Malagasy, a Perth-based minerals explorer with tenements in Madagascar, has acquired the Karlawinda project through the purchase of private company Greenmount Resources in exchange for about 171.6 million shares.

At the time of the announcement of the deal (October last year), Malagasy shares were worth 2.3 cents each, which valued the deal at about $3.9 million.

Malagasy, which will soon change its name to Capricorn Metals, has also completed a $1.5 million capital raising, with Perth gold miner Regis Resources emerging as a new shareholder in the company with a 9.9 per cent stake.

“The Karlawinda project includes the Bibra deposit and numerous outstanding exploration targets, including the advanced Francopan prospect, within an under-explored 290 square kilometre tenement package,” Malagasy said in a statement.

“The Bibra deposit was discovered in 2012 by Independence Group, which spent about $12 million on resource evaluation, scoping study activities and initial regional exploration.”

Malagasy will use the funds raised from the placement to commence an in-fill drilling program at Karlawinda to grow the project’s current JORC 2012 mineral resource.

Malagasy has also announced the appointment of former Doray Minerals and Independence director Heath Hellewell and GBM Resources managing director and chairman Peter Thompson to the board, in the role of managing director.

Mr Thompson said the immediate focus of the company now is to complete the drilling program for a revised resource estimate and a scoping study, which Malagasy is aiming to complete by the middle of the year.

“This should give investors a much clearer idea of the significant economic potential of this deposit, which represents a near-term production and cashflow opportunity within this under-explored and high-potential gold belt,” Mr Thompson said.

“We will also begin to turn our attention to the huge untapped exploration potential within our tenement holding.

“This includes the Francopan prospect, which was originally discovered by WMC Resources in 2005 and contains a number of high-grade intercepts.

“Broad gold intersections from both Francopan and Bibra deposits demonstrate the size of the gold mineralising system at Karlawinda and these deposits may well be geologically connected – a theory which we plan to test further as part of our regional exploration strategy.”

Malagasy shares were unchanged at 6 cents each at 11:45am.

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