Castle Minerals (ASX:CDT) listed in 2006 to explore for gold in Ghana and, over the next decade or so, sank tens of millions of dollars into its huge ~11,000sqkm landholding.

Castle made a number of significant greenfield discoveries, with the share price peaking at around 64c in 2010.

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But a subsequent tough period for junior exploration led to refreshed board and a rationalisation of what new management called these “legacy” Ghanaian gold assets.

Castle made the move into Pilbara conglomerate gold, which was great for a while. (Not so much now, of course.)

This means Castle Minerals has been ostensibly treading water for much of this year. Until now, that is, because the ~$3m market cap explorer just signed a significant, $US11.7m farmout deal with private company Iguana Resources over a couple of its unwanted Ghanian projects.

Iguana can earn up to 80 per cent of the Degbiwu and Gbiniyiri licences in Ghana’s Upper West by spending this cash in three stages over five years.

It’s fantastic news for a cash-strapped Castle.

“This US$11.7 million, three-staged farm-out deal on the Degbiwu and Gbiniyiri licences with Ghana-based Iguana Resources will see an acceleration in exploration activity on these prospective licences and in particular the Kpali target, where Castle has previously outlined an open-ended 107,200oz gold Inferred mineral resource, and at the intriguing Bundi gold-zinc prospect,” Castle managing director Stephen Stone said.

These Ghana licences also neighbour the 2.8Moz Wa gold project owned by Azumah Resources (ASX:AZM), which is currently completing a feasibility study on a long life, multi open pit mining operation.

Castle is up over 100 per cent to 1.2c in early trade on the news.


In other ASX gold news today:

Xanadu Mines (ASX:XAM) is up 19 per cent after intersecting 40m at 2.3g/t from surface at the Kharmagtai Project in southern Mongolia. Solid hits from first pass drilling at the Stockwork Hill prospect confirmed Xanadu’s belief that old drilling misjudged how much gold was in the oxide zone, chief exec Dr Andrew Stewart says.

“These outstanding gold intercepts generated at Stockwork Hill show just how underexplored the broader Kharmagtai project is for oxide gold mineralisation and validates the current plan of developing a low-cost, high-value gold starter project at Kharmagtai,” he says.

Xanadu’s long running objective is to develop Mongolia’s next large-scale open pit copper and gold deposit, says Stewart.

“However, given Kharmagtai sits on a granted mining lease with a registered water resource and an established power supply nearby, we have the ability to move quickly on an oxide gold project.”