Gold: Musgrave buddies up with Evolution Mining in $18m joint venture
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Gold explorer Musgrave Minerals (ASX:MGV) is bringing in some help to look for gold at its Cue project in Lake Austin, around 700km north of Perth.
The company has entered into a joint venture with much bigger gold producer Evolution Mining (ASX:EVN), which will take on the bulk of the early exploration costs.
Under the earn-in agreement, Evolution can take a 75 per cent stake in the asset by contributing $18m in capital over the next five years.
The deal requires Evolution to pay a minimum of $4m over the first two years, and if the $18m target isn’t met Musgrave will reclaim full ownership of the project.
Musgrave shares climbed by around 2 per cent in morning trade to 8.5c, while shares in Evolution dipped slightly.
As part of the JV, Evolution will also take an ownership stake in Musgrave, with the company agreeing to buy 18,587,361 shares priced at 8.07c via a share placement.
The extra $1.5m in funds raised will leave Musgrave with $4.2m cash in the bank. The company will assume a management role at the site over the initial two-year period, with “technical input from Evolution”.
“The JV will fast track exploration, and we look forward to leveraging Evolution’s extensive technical knowledge and financial resources with our in-house expertise to accelerate potential gold discoveries at Cue,” Musgrave MD Rob Waugh said.
Musgrave will also retain its interest in other projects in the area, leaving it with the rights to explore territory covering 172sqkm.
The JV project at Cue includes drill-ready targets where the companies will test for greenstone orogenic gold deposits, as well as unexplored continuations of multi-million ounce gold deposits in the region.
Junior explorer Troy Resources (ASX:TRY) provided an exploration update at its Karouni gold project in Guyana. The company said it found “significant intersections at depth” including a 0.2m strike at 196.76 grams per tonne (g/t). Shares in TRY were unchanged at 11.5c.
Arrow Minerals (ASX:AMD) has completed a 24-hole reverse circulation drilling program at its Divole East project in Burkina Faso. The company said it “intersected gold mineralisation at each of the three targets tested”, and will return to those targets when drilling reason recommences in Q4. Shares in AMD ticked lower to 1c.
Yandal Resources (ASX:YRL) has started drilling at its Gordons gold project in the Kalgoorlie-Boulder region of WA. The 27-hole drilling program “will test for extensions to primary gold mineralisation intersected in earlier programs”. Shares in YRL were up 3.85 per cent in morning trade to 27c.
And Predictive Discovery (ASX: PDI) has found some more gold at its fully-owned Kaninko project in Guinea. The company said seven samples from “strongly weathered bedrock (saprolite) returned an average gold reading of 1.5g/t. Predictive is now planning some larger geochemical surveys at its sites in the region before starting drilling at its best products in the March quarter of 2020. Shares in PDI were up 8 per cent at 1.3c.