S2 sells Polar Bear to Westgold

Mark Bennett’s S2 Resources has sold the Polar Bear gold project to Westgold in a $9 million partially scrip deal.

Westgold, which operates the Higginsville gold mine, will pay $3 million in cash and a further $4 million in shares .

The Polar Bear project includes the Baloo deposit, which is about 15 kilometres from the Higginsville mine, with a resource estimate of 264,000 ounces of gold.

Other projects in the deal were Norcott and the Eundynie joint venture, of which S2 held 80 per cent.

Scarborough-based S2R, which was spun-out when Independence Group bought Sirius Resources, will focus on exploration projects in Scandinavia and Nevada.

S2 managing director Mark Bennett said the agreement was part of the strategy to focus on opportunities with the best potential for making discoveries.

But it would minimise the need for external funding and ensure capital structure was as tight as possible, he said.

That would mean shareholders would achieve maximum leverage if the exploration projects delivered.

“We are also pleased to become a shareholder of Westgold and look forward to Westgold progressing the development and exploration of the WA gold projects,” Mr Bennett said.

Westgold managing director Peter Cook said the package of tenements was a good fit with the Higginsville project.

"The discovery of these deposits by S2R and the significant discovery of the Invincible mine by Goldfields to the north has opened this region as a new province of gold discoveries in stratigraphy previously under-evaluated for its gold potential," he said.

"We are delighted to be a major landholder in the region with one of the few operating process plants in place to commercialise the region."

Shares in S2 were unchanged at 17 cents each at the time of writing.