- Ausgold (AUC) enters a farm-in deal with ASX-listed mineral explorer Cygnus Gold (CY5) to earn up to 85 per cent of the Stanley gold project
- The Stanley gold project in WA’s Wheatbelt and shares the same prospective greenstone belt as Ausgold’s Katanning gold project 25 kilometres away
- Ausgold will spend up to $750,000 on exploration over three years to own 85 per cent of Stanley while Cygnus will retain a 15 per cent free-carried interest until a decision to mine
- AUC shares ended Tuesday’s session 4 per cent in the green at 7.8 cents and CY5 shares were down 2.94 per cent at 16.5 cents
Ausgold (AUC) has entered a farm-in agreement with minerals explorer Cygnus Gold (CY5) for the Stanley gold project in Western Australia’s Wheatbelt.
The Stanley project is made up of two exploration licences, E70/5131 and E70/4787, covering approximately 233 square kilometres of the northern Katanning greenstone belt.
The highly prospective belt contains the same sequence that hosts Ausgold’s Katanning gold project 25 kilometres away.
Previous drilling at the Stanley project returned results of 8.5 metres at 33 g/t gold from 37.7 metres including 2.4 metres at 114.62 g/t gold, 5.7 metres at 28.6 g/t gold, and 16 metres at 4.99 g/t from 30 metres.
Under the farm-in deal, Ausgold may earn up to an 85 per cent interest in the Stanley project over three years by spending $500,000 over two years to earn the initial 51 majority interest.
For a further 34 per cent interest, Ausgold will need to spend another $250,000 in the final 12 months of the agreement.
Cygnus will retain a 15 per cent free-carried interest in Stanley up until a decision to mine. It also has the right to convert its interest to a 1.5 per cent net smelter royalty.
Cygnus Gold Executive Chairman Ray Shorrocks said he was pleased to partner with an “active and experienced explorer in the South West Terrane of WA.”
“The company will continue to focus our exploration efforts on our exciting Bonnie Rock, Snake Rock, Julimar East and Bencubbin projects targeting nickel, copper, PGEs and gold,” Mr Shorrocks said.
Ausgold Managing Director Matthew Greentree said the agreement “adds a district-scale option that supports our ambition to establish a multimillion-ounce resource position at Katanning.”
“The greater Katanning area is under-explored and based on previous work, we see no reason why the region cannot host additional Katanning central zone high-grade style discoveries,” Mr Greentree said.
Six drill-ready targets have been identified in recently collected geophysics, geochemistry and drilling and Ausgold says it looks forward to further unlocking the potential of the region.
AUC shares ended Tuesday’s session 4 per cent in the green at 7.8 cents and Cygnus shares were down 2.94 per cent at 16.5 cents each.