This explorer is looking to spin-off its WA gold project

3D Resources (ASX:DDD) is looking to spin-off its Cosmo Newbery gold project in WA into a new ASX company, which will allow it to focus on recommencing production at its flagship Adelong goldfield in southern NSW.

The company plans to seek shareholder approval for an initial public offering (IPO) for its wholly-owned subsidiary Cosmo Gold, which holds all of its interests in Cosmo Newbery, before obtaining any required regulatory approvals.

Should approval be granted, the company has mandated RM Corporate Finance to act as lead manager and underwriter of the Cosmo IPO.

Cosmo will initially complete a preliminary seed raising from which $250,000 will be paid to 3D Resources as part consideration for the Cosmo Newbery project.

It will then carry out an underwritten IPO of not less than $4m with 3D Resources retaining an interest of at least 30 per cent in Cosmo Gold. These Cosmo Gold shares will then be distributed to 3D Resources’ shareholders.

3D Resources (ASX:DDD) share price chart

Underexplored gold project in Western Australia

Cosmo Newbery is one of the few remaining underexplored greenstone belts in WA with 3D Resources holding the major part of this greenstone belt under granted exploration licences, applications and options.

The majority of the licences are located on an Aboriginal Reserve, which is subject to special access requirements and the company has maintained its tenement position whilst negotiating access.

It received a final draft access agreement in late May 2020 and has been in discussions and negotiations with the Aboriginal claimant body corporate to finalise access.

The greenstone belt contains gold mineralisation and has historically had some small scale high grade gold mining in a portion of the greenstone belt that is exposed.

It is located between the Laverton Greenstone belt to the west that has historically produced over 20 million ounces of gold, and the Dorothy Hill Greenstone belt to the east that hosts the 6 million ounce Gruyere Deposit brought into production by Gold Road (ASX:GOR).