Northern Minerals has signed a joint venture agreement with Toro Energy to earn up to an 80 per cent interest in all minerals other than uranium produced at Toro’s Browns Range tenements in the Northern Territory.
Perth-based Northern announced today it had signed a heads of agreement over seven tenements covering 1,403 square kilometres adjacent to Browns Range in the Tanami Desert.
The company said it had previously identified high-grade heavy rare earth elements (REE) at Browns Range, and is aiming to be in production by 2015.
Under terms of the agreement, Northern will invest $4 million on exploration over three years to earn an initial 51 per cent interest in the project.
Northern has the option to increase its interest to 70 per cent, through the additional investment of $2 million over a further two years, and if it completes a bankable feasibility study, Northern can take its stake to 80 per cent.
Managing director George Bauk said the agreement complemented the company’s expansion strategy.
“We are very pleased to have reached this agreement with Toro which gives us a dominant position in the region,” Mr Bauk said in a statement.
“It complements our strategy to expand our rare earth portfolio and it further bolsters the already exciting potential of our Browns Range REE project.
“Our aim is to commence a strategic exploration program across the tenements as soon as possible, and test whether the geological setting identified at Browns Range continues into the NT.”
Mr Bauk said exploration was expected to get underway next year.
At close of trade today Northern Minerals stocks had lost 1.1 per cent, to trade at 43 cents.