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Ausgold (ASX:AUC) has put a bow on a farm-in agreement with Critica (ASX:CRI) regarding its E70/5077 exploration licence, just 75 kilometres northeast of its headlining Katanning Gold Project in Western Australia.
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“This new tenement complements our strong regional landholding surrounding our flagship Katanning Gold Project, which includes the Kulin Project as well as other advanced exploration prospects,” Ausgold chairman John Dorward said.
Ausgold will earn as much as 70% interest over the next three and a half years, spending $250,000 for 51%, then $360K more over the following 24 months for the remainder.
E70/5077 is a single granted exploration licence that runs along the eastern boundary of the Katanning Greenstone Belt, where Ausgold is already working.
Perhaps most importantly, the deal “directly aligns” with Ausgold’s plans to build a regional production hub at Katanning by digging up high-quality, near-surface satellite deposits – a plot that shapes as the WA miner’s next big move.
Any progress there can then be used to “leverage existing infrastructure,” Mr Dorward said.
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Critica, which currently carries the Jupiter Rare Earths Project in Western Australia, was interested in the deal to free cash from its non-core assets. The smallcap miner will retain a 30% interest in the licence moving forward.
The selling party will also keep the right to convert to a 1.5% net smelter royalty whenever Ausgold makes the decision to mine at the newly-bought licence.
AUC last sold 3.5% higher at 73.5cps. CRI shares have been 1.7 cents today.
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