Mutiny Gold is set to take a 70 per cent stake in the Gullewa Gold Project in the Murchison from Canadian miner ATW Gold Corp for $9 million.
Mutiny Gold is set to take a 70 per cent stake in the Gullewa Gold Project in the Murchison from Canadian miner ATW Gold Corp for $9 million.
The project has an existing resource of 650,000 ounces of gold and 25,000 tonnes of copper.
The mine already has infrastructure in place including a mill, camp and offices.
Mutiny has an option to acquire the final 30 per cent of the project for $4 million.
In a statement the company said it would meet the commitments by raising capital through a combination of institutional investors and rights issue to shareholders.
See full company statement below:
Mutiny Gold Limited (ASX: MYG "Mutiny" or "the Company") is pleased to announce it has reached agreement to purchase the Gullewa Gold Project (the Project) from
Canadian Miner ATW Gold Corp (ATW), (TSX V: ATW) providing Mutiny with a potential company transforming asset with near term production capability.
Gullewa Gold Project Acquisition Terms
Under the agreement Mutiny will purchase the project for a total cash payment of $9m plus replacement of the bonds for 70% ownership and the right to acquire 100% for a further $4m.
1. by making the following cash payments (the "cash payments")
i. Payment of $250,000 non-refundable deposit upon signing the agreement;
ii. Payment of AUD$1.25million on or before September 24 2010;
iii. Payment of AUD$1.5million on or before January 24 2011;
iv. Payment of AUD$4.0million on or before July 24 2011; and
v. Payment of AUD$2.0million on or before 30 October 2011.
2. by paying all exploration and development expenditures on the Gullewa Project
until 30 October 2011.
Upon earning a 70% interest in the Gullewa Project, Mutiny may elect to enter into a
70/30 joint venture agreement with ATW or it may purchase the remaining 30% interest by completing a positive feasibility study of the Gullewa Project and by paying to ATW an additional AUD$4.0million. If it so elects, then it will have acquired the Gullewa Project 100% and ATW will retain only a 10% net profit interest.
Mutiny will meet the commitments by raising capital through a combination of institutional investors and rights issue to shareholders. Capital raising plans are well advanced and further updates will follow.
