- Antipa Minerals (AZY) has announced a $30 million farm-in agreement with IGO (IGO) as well as two share placements totalling roughly $3.6 million
- The farm-in with IGO will allow it to earn a 70 per cent interest in Antipa’s wholly-owned tenements within the Paterson province of WA
- To do this, IGO will need to spend $30 million on exploration within the first 6.5 years of the farm-in
- Once this has been completed, the companies will enter a joint venture
- The placement with IGO will see it acquire a 4.9 per cent shareholding in Antipa for 2.75 cents each to raise $3.27 million
- Additionally, Antipa has entered a subscription agreement with Newcrest Mining
- Newcrest will maintain its 9.9 per cent shareholding through a placement to raise $358,909
- The placements are expected to be settled on July 13
- Company shares are up 11.5 per cent and trading for 2.9 cents each
Antipa Minerals (AZY) has entered a $30 million farm-in agreement with IGO (IGO) for 1563 square kilometres of tenements in the Paterson Province of Western Australia.
Additionally, Antipa has entered two subscription agreements.
These include a subscription agreement, in which IGO will acquire a 4.9 per cent shareholding in Antipa through a placement of new shares at 2.75 cents each to raise $3.27 million.
The second subscription agreement is with Newcrest Mining and will see Newcrest maintain its 9.9 per cent shareholding through a placement of new shares at 2.75 cents each to raise $358,909.
“IGO is very pleased to be adding Antipa’s Paterson Project to our portfolio of projects in the highly prospective Paterson Copper-Gold Province in Western Australia,” IGO Managing Director Peter Bradford said.
“IGO is also pleased to become a shareholder of Antipa, given Antipa’s outstanding pipeline of projects at various stages of exploration across the Paterson region,” Peter added.
Farm-in agreement
Antipa has entered the farm-in with IGO through its wholly-owned subsidiaries, Antipa Resources, Kitchener Resources and MK Minerals.
Under the farm-in, IGO may earn a 70 per cent joint venture interest in Antipa’s tenements which collectively form the Paterson Project.
IGO has already committed to funding at least $4 million on the farm-in area within the first 2.5 years of the agreement. At least 75 per cent of the money will be directed towards in-ground activities.
IGO will prepare the initial exploration program which is expected to include various surveys, sampling and drilling.
Antipa Minerals will initially manage operations and will receive a management fee of 10 per cent on all eligible expenditure for the period.
After the initial 2.5 years, IGO can choose to withdraw from the agreement and if it doesn’t, the farm-in will automatically continue.
The next stage will include a further $26 million of optional expenditure within 6.5 years from the commencement of the farm-in to earn the 70 per cent interest.
“This transaction, being the company’s third major farm-in agreement following similar deals with Rio Tinto in 2015 and Newcrest Mining earlier this year, provides further validation of our efforts to build a strategic landholding in the Paterson Province at a time when the region’s geological potential wasn’t as keenly appreciated as it is today,” Antipa Executive Chairman Stephen Power said.
The farm-in will commence once the $3.27 million placement has been completed.
Joint venture
If and when IGO earns 70 per cent, the companies will form an official joint venture. This will see IGO free-carry Antipa to the completion of a feasibility study.
The parties will make a decision on whether to mine the area, which would then lead to a new joint venture.
Share placements
IGO and Antipa’s subscription agreement will see IGO acquire a 4.9 per cent shareholding in Antipa at 2.75 cents each which represents a 25 per cent premium to Antipa’s 10-day volume-weighted average price before Antipa receives a non-binding farm-in proposal from IGO.
Newcrest and Antipa’s subscription agreement will see Newcrest acquire a further 13,065,500 shares in Antipa.
Together, the placements will comprise the issue of 131,974,500 shares at 2.747 cents each to raise a total of $3.625 million.
The placements are expected to be settled on July 13.
Company shares are up 11.5 per cent and trading for 2.9 cents each at 1:06 pm AEST.