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Genesis Minerals (ASX:GMD) is boosting its West Australian gold portfolio by acquiring the Laverton gold project to provide both open-pit and underground ore to its established Laverton mill, located only 30 kilometres away.
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The company has entered a binding share purchase agreement with the current owner, Focus Minerals (ASX:FML), for an upfront cash consideration of $250 million.
Laverton boasts a mineral resource of four million ounces at 1.7 grams per tonne (g/t) – equating to around $63 per resource ounce – with reserves of 546,000 ounces at 1.3g/t, and Genesis is looking ahead to exploration of its wider tenement package.
In addition to infill and extensional drilling to derisk and rebuild the resource, optimisation and expansion studies, it will also be the focus of exploration further down the line; all this is in line with Genesis’ “ASPIRE 400” growth strategy.
Crucially, the acquisition will let the company connect the project’s main deposits with infrastructure at Genesis’ Leonora and Laverton operations.
Completion of the acquisition is set for early June, the company confirmed today.
After putting pen to paper, managing director Raleigh Finlayson said the project was a highly strategic and opportunistic acquisition. “This is the perfect bolt-on acquisition,” he said. “It delivers a substantial 4 Moz Resource with immense exploration upside right next to our Laverton mill.”
“It offers supplementary open pit and underground ore to our Laverton mill and, in the process, gives us flexibility regarding the most efficient pairing of deposits and processing infrastructure between Laverton and Leonora.
“With more ore available at Laverton, our flagship Tower Hill deposit can potentially be processed at Leonora, resulting in significantly lower operating costs.”
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Alongside the acquisition, Genesis has also bolstered its board with the introduction of mining engineer Duncan Coutts, who will take on the role of executive director, while Mick Wilkes will retire as a non-executive director but will be retained as a technical advisor to support the ‘ASPIRE 400’ strategy.
GMD has been trading at $4.34 heading into Week 22.
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