10/05/2021 - 11:00

Northern Star commits to Tanami JV

10/05/2021 - 11:00

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Goldminer Northern Star Resources is paying $15 million in cash for a further stake in a joint venture with Tanami Gold while entering into a new service agreement.

Northern Star commits to Tanami JV
Northern Star now owns 50 per cent of the Central Tanami gold project in the Northern Territory. Photo: Tanami Gold

Goldminer Northern Star Resources will pay $15 million in cash for a further 10 per cent stake in a joint venture with Tanami Gold while entering into a new service agreement.

Each company now owns 50 per cent of Tanami’s flagship project in the Northern Territory, Central Tanami, which is located about 650 kilometres northwest of Alice Springs and 850km south-west of Darwin.

Shares in Tanami Gold were up 12 per cent on the news to trade at 8.6 cents, as at 11:58pm AEST.

The duo first entered into a JV agreement in mid-2015 when Northern Star acquired an initial 25 per cent stake in Central Tanami over rival bidder, Metals X.

The revised JV, announced today, will replace the previous heads of agreement between Northern Star and Tanami Gold.

Both companies will jointly fund all exploration and development activities, to be carried out by an independently staffed management business, South Perth-based Tanami said.

It said the JV would develop a program to complete initial exploration drilling, engineering studies, and plant design works as soon as possible.

Northern Star has also entered into a new service agreement with Tanami where it will provide certain services such as indigenous affairs to the JV at market rates.

The proposed deal is subject to several conditions including ministerial and shareholder approval.

Tanami said it would provide a notice of meeting to shareholders in due course.

Its shares dropped back to 8.4 cents at 12:11pm AEST, up 9 per cent on Friday’s closing price, while Northern Star's shares were up 2.8 per cent to $11.18.

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