Multi-commodity explorer Venus Metals has this week pocketed $2.55m and a swag of shares in fellow ASX-listed company Rox Resources after the companies settled a 50/50 joint venture, or “JV”, agreement for the prospective Youanmi gold mine in WA.
Venus purchased the mothballed gold mine for $6m in cash and shares in May last year, with a cashed-up Rox saying in April that it would join forces with Venus to breathe new life back into the underexplored Youanmi region.
The Youanmi mine holds a current JORC-compliant resource of 12.4 million tonnes grading 2.97g/t gold for just over 1.19 million ounces.
Completing the acquisition has also formally triggered a series of four separate JV’s between the two companies.
The 50/50 OYG JV over the Youanmi mining leases now requires Rox to spend $2m on exploration over the next two years to obtain its stake, which includes keeping the tenements in good standing by paying all applicable rents and rates on the ground.
Pending this, Rox can then increase its holding to 70% in the OYG JV on or before 30 June 2021, by paying Venus $3m in cash or $1.5m cash and the remaining $1.5m in Rox Resources shares.
Rox will manage this JV and Venus will be entitled to a 0.7% net smelter royalty for any mineral production from the OYG JV tenement package.
Rox is planning to kick off a 14,500 metre RC drilling program over the Youanmi mining leases next month, where multiple targets have been identified, to both confirm and expand the near-surface oxide resources.
In addition, the acquisition has set in motion the Venus JV, where Rox can earn a 50% holding in the gold rights on five regional exploration leases surrounding the Youanmi mining leases by contributing $800,000 on exploration.
Venus will manage this JV and contribute 50% towards ongoing exploration and development, once Rox has attained its 50% stake.
Interestingly, the southern exploration leases in the Venus JV surround Spectrum Metals’ Penny West gold project, which includes the recent Penny North discovery of high-grade gold mineralisation.
The areas adjacent and along strike from Penny West will be the focus of RC and aircore drilling starting in July, along with the separate Golden Victoria prospect.
The third, Youanmi JV covers another package of tenements southwest and northeast of the Youanmi mining leases, where Rox can earn a 45% share of the gold rights by spending $200,000 over two years, after which both companies will contribute equally to expenditure.
Venus will manage the Youanmi JV agreement.
A prospector holds the remaining 10% stake in the ground and is free-carried at this stage.
The fourth JV covers the more recent Currans Find JV, where Venus and Rox are both contributing equally to the exciting Currans Find JV and Pinchers JV, which are both located on granted mining licences a short distance north of the Spectrum Metals ground.
A prospector holds the remaining 10% stake in the Currans Find JV and is free-carried at this stage, with Venus to manage the JV.
Earlier this month, the companies drilled high-grade gold intersections in two separate prospects on the Currans Find tenement, which were located near the surface in the oxide profile.
With the recent settlement of the Youanmi gold mine acquisition, Venus is now cashed up again to recommence regional exploration work within the Youanmi greenstone belt and other projects it holds around WA.
These include the nearby Youanmi vanadium oxide project, the Bell Chambers gold project near Sandstone and prospective copper ground near Sandfire’s DeGrussa mine north of Meekatharra in the Murchison district.
Venus Managing Director Matthew Hogan said: “We are very pleased to complete settlement of the Youanmi gold mine option. The gold mine itself, with its substantial gold resources and infrastructure, was the last major piece needed to complete our tenement consolidation over the highly prospective Youanmi greenstone belt.”
“With our new joint venture partner in place, the necessary drilling and exploration to advance the project is set for the next two years”.
