Ora Banda, Wesfarmers reach $26m JV deal

Ora Banda Mining has struck a $26 million joint venture and farm-in agreement with conglomerate Wesfarmers for its lithium mining rights at its Goldfields foothold. 

Under the deal, Ora Banda will sell 65 per cent of its mineral rights, other than gold and by-products, for its Davyhurst tenement package west of Kalgoorlie for $26 million and a 2 per cent royalty.

Ora Banda has previously confirmed lithium prospects at its Davyhurst foothold, which is primarily a gold-focused asset.

Wesfarmers Chemicals, Energy and Fertilisers’s subsidy Brenahan Exploration (65 per cent) and Ora Banda (35 per cent) will form a joint venture to progress exploration at the tenement foothold.

The conglomerate has the option to lift its stake to 80 per cent by sole funding $15 million worth of exploration over three years.

Ora Banda is free carried from any discovery to the completion of a definitive feasibility study, while areas outside the DFS area will remain in the exploration JV.

The miner has also agreed to on-sell 1.5 per cent of the 2 per cent royalty, for non-gold minerals produced under the deal, to Hawke’s Point Holdings for $4 million in cash.

Ora Banda managing director Luke Creagh said the company viewed the transaction as a $45 million deal, with $30 million in cash and $15 million in exploration expenditure.

“The deal structure is aligned to maximise the potential of multiple discoveries to the benefit of both parties, whilst providing balance sheet strength to Ora Banda to further grow gold production,” he said.

Subject to conditions, the transaction is expected to be complete in the first quarter of 2024.

Ora Banda was advised by Sternship Advisers and Gilbert + Tobin.

The announcement sent the miner’s shares surging 18.5 per cent at 11.30AM AWST to trade at 16 cents per share.