10/10/2000 - 21:00

Metex set to reap rewards

10/10/2000 - 21:00

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METEX Resources NL is set to reap the rewards of its long-term commitment to WA’s prospective Laverton region after positioning itself to monetise the Chatterbox oxide gold resources through a key mining and processing agreement with the managers of the n

Metex set to reap rewards

METEX Resources NL is set to reap the rewards of its long-term commitment to WA’s prospective Laverton region after positioning itself to monetise the Chatterbox oxide gold resources through a key mining and processing agreement with the managers of the nearby Granny Smith gold mine, Placer (Granny Smith) Pty Limited.

The agreement, between the Laverton Exploration Joint Venture (LEJV) and the Granny Smith Joint Venture (GSJV), could lead to commercial development of the Chatterbox resources with the ore processed at the Granny Smith mill, 20 kilometres away, in exchange for an escalating two-stage royalty.

Metex managing director Ian Walker said the agreement would allow Metex to derive a significant cash flow from the Chatterbox resources and marked the first chapter in a regional arrangement with the Granny Smith JV that could further unlock the potential of other gold resources in the region as well as future discoveries.

Total gold resources within the LEJV Laverton tenement package and Metex’s 100 per cent-owned Lancefield lease is 1.21 million ounces, while Metex is continuing to spearhead an aggressive exploration program in the area, which has resulted in very promising recent discoveries.

The LEJV is a 50-50 joint venture between Metex and Delta Gold Limited.

The agreement with the GSJV covers the open pit mineable resources of the Chatterbox deposits, located on the Innuendo, Whisper, Rumour and Garden Well tenements – hosting 6.2 million tonnes at 2.3 grams/tonne for about 463,000 ounces of gold. The tenements and resources are held by the LEJV (Metex 50 per cent, Delta 50 per cent).

The GSJV will undertake a feasibility study to develop the resources. It will also be responsible for all project capital costs together with any additional royalties related to the tenements. The feasibility study is expected to be completed in 2001.

The agreement provides for LEJV to receive a royalty based on an initial production of 75,000 ounces. Once 75,000 oz have been recovered, rates will range between $43.80 and $75/oz. The lower rate applies to gold prices less than $450/oz, with the highest rate applying above $525 per ounce.

“From the longer-term perspective, the GSJV will significantly have the right to mine any additional open pit resources delineated on these tenements under the same terms and conditions – highlighting the significance of this agreement as the first step in a regional arrangement with Granny Smith as a dominant central processing facility,” Mr Walker said.

He said the Perth-based company’s long-term exploration commitment to the region continued to pay dividends, with the recent identification of some very high-grade gold occurrences and the potential to delineate further resources at depth at Chatterbox which has not been previously explored.

Metex has reported recent encouraging drilling results at the new discovery 5H at Beasley/Gladiator and also finalised an innovative arrangement with drilling company Grimwood Davies to explore the Roe Project Area, adjacent to Pacmin’s Carosue Dam (2.2 million ounces) deposit.

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