- GBM Resources (GBZ) signs a farm-in agreement with Newcrest Operations, a subsidiary of Newcrest Mining (NCM), to advance its Mount Coolon Gold project in Queensland
- Newcrest can acquire an interest of up to 75 per cent in the Mount Coolon tenements by spending $25 million and completing exploration milestones over the next six years
- Upon the completion of the stage one milestone, Newcrest and GBM will establish a joint venture to undertake exploration, development and mining over the tenements
- The farm-in deal provides “substantial” potential funding to advance exploration at Mount Coolon while allowing GBM to focus on its Twin Hills and Yandan gold projects
- GBM closes 14.6 per cent higher at 4.7 cents
GBM Resources (GBZ) has signed a farm-in agreement with Newcrest Operations, a subsidiary of Newcrest Mining (NCM), to advance its Mount Coolon Gold project in Queensland
Under the deal, Newcrest can acquire an interest of up to 75 per cent in the Mount Coolon tenements by spending $25 million and completing exploration milestones over the next six years.
Over the next 24 months, Newcrest must spend $2 million and endeavour to complete at least 3000 metres of drilling in the area to satisfy its minimum farm-in commitments.
Under stage one of the deal, Newcrest can acquire a 51 per cent interest in Mount Coolon by spending a further $5 million and completing an additional 7000 metres of drilling within 36 months.
If Newcrest completes stage one, it will establish a joint venture with GBM to undertake exploration, development and mining over the tenements.
Upon completing stage one, Newcrest can earn a further 24 per cent interest by spending $18 million and completing a further 10,000 metres of drilling within an extra 36 months.
“Over the last three years, GBM has assembled a highly prospective tenement package in the Drummond Basin, where large high-grade epithermal gold deposits exist, and we are pleased to have joined forces with Newcrest on advancing exploration in the basin and accessing its funding and geological experience in epithermal systems,” GBM CEO and Managing Director Peter Rohner said.
“In the short term, GBM will continue its exploration focus on the highly prospective Twin Hills tenement package and advance resource re-estimation work following the recent initial drilling program.”
GBM said the farm-in from Newcrest provided the potential for “substantial” funding to advance exploration at Mount Coolon while allowing GBM to focus on its Twin Hills and Yandan Gold projects.
Additionally, subject to shareholder approval, Newcrest will have first right of refusal over both the Twin Hills and Yandan projects if GBM chooses to sell or joint venture them.
“We are pleased to partner with GBM on their Mt Coolon tenements in Queensland,” Newcrest General Manager of Exploration Fraser MacCorquodale said.
“The Drummond Basin has a historic pedigree of hosting high-grade epithermal mines, and we are looking forward to using both team’s expertise to accelerate the exploration program at Mt Coolon to support the potential for discovery.”
GBM shares closed 14.6 per cent higher at 4.7 cents.