Mount Magnet South NL has acquired the Curara Well gold mine and other tenements in the Mt Magnet region of Western Australia for $5 million from Equigold NL.
Mount Magnet South NL has acquired the Curara Well gold mine and other tenements in the Mt Magnet region of Western Australia for $5 million from Equigold NL.
The West Perth-based company has signed a Heads of Agreement with Equigold to purchase its Kirkalocka Project, which covers 1,500 square kilometres of land- making Mount Magnet South the biggest holder of exploration land in the highly prospective region.
The Equigold holdings are immediately south of Mount Magnet South's Jumbulyer tenements and are being purchased for a total $5 million - $1.5 million in cash and $3.5 million in MUM shares.
Equigold retains the Kirkalocka processing plant, stockpiles and infrastructure, and environmental bonding liabilities relating to its completion of milling and rehabilitation work.
The acquisition triples Mount Magnet South's existing holdings of 739 square kilometres.
"The remaining Curara Well resource contains a 40-thousand ounce high-grade zone averaging 6.6 grams per tonne and is open at depth," said Andrew Paterson, Mount Magnet South's Managing Director.
"It will be an immediate target for expansion because the tenor of mineralisation suggests it has potential for future underground mining, or a cut-back of the pit.
Up to 2005, Equigold recovered almost 300-thousand ounces of gold from the Curara Well open pit mine, with 138-thousand ounces remaining in resource below the pit.
"Apart from Curara Well, the other tenements being acquired cover substantially unexplored holdings and are an excellent addition to the prospective tenements we already hold in the Murchison goldfield."
"Much of this prospective greenstone terrain has been left largely untouched, including highly prospective targets under alluvial cover. The project also has potential to host uranium and iron ore mineralisation, in addition to being in such a fantastic gold province," said Mr Paterson.
A number of conceptual targets were generated by Equigold based on geophysical interpretation and mapping.
Many of these are yet to be tested, as their exploration was mainly focused on the Curara Well mine, with only shallow RAB drilling and soil geochemistry elsewhere.
"We will continue focusing on our existing Mt Magnet targets whilst simultaneously working up the Kirkalocka ground with the aim of proving up new resources.
"This acquisition - our first since listing publicly last May - represents a significant strategic advance for Mount Magnet South - particularly its potential to accelerate our stated aim of becoming a major gold producer."
