Mt Magnet to sell gold project for $1.7m

West Perth-based gold explorer Mount Magnet South has announced plans to sell its Kirkalocka project in the Murchison region to Ozchina Enterprises for $1.7 million.

Under the terms of the deal, Mt Magnet will retain ownership of several tenements at Kirkalocka, which it said hosted significant iron mineralisation, but will surrender all gold rights associated with them.

Ozchina’s offer is subject to Mt Magnet negotiating an agreement to defer a payment it owes to Newcrest Mining, in relation to Mt Magnet’s $5 million purchase of the Kirkalocka project from Equigold in 2008, until gold production at the project commences.

“The company has engaged Capital Investment Partners as corporate advisor to a number of transactions including the arrangement of capital for the Kirkalocka project, the divestment of the project or infrastructure or alternatively the merger or acquisition of the company,” Mt Magnet said.

Mt Magnet shares closed unchanged at 0.2 cents per share.