Gold City: M&A potential looms large in Forrestania gold belt as TG Metals locks in $4m placement

• TG Metals raises $4m from instos and sophisticated investors to load up on Van Uden gold drilling
• Consolidation intrigue simmers as Forrestania takes 9.83% stake in TG
• WA gold belt draws increasing attention as prices run past $5600/oz

It’s become the hottest WA gold field you’ve never heard of.

But big spenders are making a beeline for the Forrestania gold belt, as the potential for consolidation in the overlooked precious metals district comes to a simmer.

The latest evidence of institutional interest in the region comes in the form of a $4m raising by TG Metals (ASX:TG6), the lithium turned gold explorer which has put its foot on one of the most advanced projects in the region – the 227,000oz Van Uden.

Purchased off a subsidiary of business conglomerate Wesfarmers, the 80% stake delivers control of previously producing pits and stockpiles already on granted mining leases.

The raising, priced at 22c per share, will give TG the ammo to go hard on infill and extensional drilling at Van Uden, which is located to the west of the Mt Holland lithium mine, south of the Marvel Loch gold mine and processing plant and southeast of Ramelius Resources’ (ASX:RMS) mothballed Edna May gold mine and mill.

Around 68,340oz at 1.2g/t are already in indicated resources, with drilling dense enough to underpin reserve calculations and be plugged into a mine plan.

And the hunt for an elephant is also on. TG wants to use the funds, $6.5m post raise, to ramp up exploration on a recently identified 6.5km long gold in soil anomaly on the Van Uden shear.

The timing of the raise, which includes the introduction of notable funds like Melbourne’s Datt Capital, is intriguing as well.

It comes just three days after neighbouring gold explorer Forrestania Resources (ASX:FRS), which has been madly acquiring projects in the belt and elsewhere in WA’s Eastern Goldfields, emerged as a 9.83% shareholder at TG.

Forrestania, which has climbed 1375% YTD to hit a market cap of $108m, revealed the $1.765m acquisition of the TG6 stake on Friday.

It counts a big wig in David Geraghty as its chair, a former MinRes executive who spent upwards of two decades as a trusted official at the Chris Ellison-led lithium and iron ore miner.

Consolidation picture takes shape

There’s plenty more to come in the district.

Medallion Metals (ASX:MM8) is on track to become one of the major players after going binding on its proposed acquisition of IGO’s (ASX:IGO) Forrestania Nickel Operations.

That will enable it to retool the Cosmic Boy mill as a processing facility for its Ravensthorpe gold project, a key bit of infrastructure that could open up nearby deposits.

It also delivers around 900km2 of territory locked up for years by successive nickel producers to gold focused exploration neglected for decades.

Another well-heeled name in Indian-backed MEGA Resources, part of the Bain Global Resources empire, has made the 85,000oz Rama gold project, due for its first gold pour next quarter, its flagship.

MEGA has made a name for itself in recent months as one of the rising participants in Australia’s 2025 gold boom.

With prices running beyond $5600/oz, it’s emerged as a contracting partner and enabler for a host of small gold companies to develop minor deposits for processing at third party plants.

Most recently, MEGA was revealed as the mining, project financing and haulage provider for Javelin Minerals’ (ASX:JAV) Eureka gold project near Kalgoorlie.

READ: Record gold price signals boom time for micro caps

The real catalyst for the region could be the potential sale of the Bounty gold mine, Forrestania’s biggest producer after the Chinese-owned Marvel Loch mine near Southern Cross.

Discovered in the 1980s from re-assayed nickel drilling, Bounty went on to produce 1.3Moz.

But it sits within the tenure of Wesfarmers (ASX:WES) and SQM’s Covalent Lithium JV, and could be a nice cash injection for them to raise some capital for the Mt Holland mine with lithium prices continuing to trade at a cyclical low.

Chatter from around the corporate side of the Aussie mining space has suggested Bounty could be packaged for suitors, of which there will be no shortage at current record gold prices.

Gold City

Meanwhile, today’s cap raise will allow TG to fire up the rigs, including maiden drilling at the Gold City prospect.

“We are delighted with the strong support received for this placement, which was significantly oversubscribed and demonstrates continued investor confidence in TG Metals and our highly strategic Van Uden Gold Project. We welcome our new shareholders,” TG6 chair Richard Bevan said.

“There are opportunities to add value to the Van Uden Project through resource infill and extensional drilling programs, as well as the new strike extensions recently identified.

“Our location in the highly prospective and underexplored Forrestania Greenstone Belt, proximal to nearby mills, adds another layer of value to the asset.

“The capital raised will allow us to accelerate our drilling programs, which includes assessing the potential of Gold City. We are excited at the growth opportunities in front of the Company at a time of record high gold prices.”

The new shares will be issued after a meeting to approve the placement, expected to take place in late October.

At Stockhead, we tell it like it is. While TG Metals, Medallion Metals and Javelin Minerals are Stockhead advertisers, they did not sponsor this article.