Metals X buys gold project

Metals X has acquired Kidman Resources’ Gunga gold project near Kalgoorlie in a deal worth up to $2.5 million.

Gunga is located just 30 kilometres from Metals X’s Jubilee mill, which forms part of its South Kalgoorlie portfolio of operations.

The consideration includes $1.5 million in cash with $500,000 in additional payments if gold production passes 10,000 ounces, plus a further $500,000 if production exceeds a further 30,000oz.

“Open-pit mining is planned and will provide supplementary feed to the Jubilee mill over the ensuring years,” Metals X said in a statement.

Kidman, meanwhile, plans to combine the proceeds of the sale with a $6.5 million capital raising to fund its $3.5 million acquisition of the Mt Holland project near Southern Cross, as well as uplift production at its Burbanks mine near Coolgardie.

Metals X shares were unchanged at 93.5 cents each, while Kidman shares were 1.1 per cent lower to 8.3 cents each at the close.