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Great Divide Mining (ASX:GDM) has inked a farm-in deal with ASX-listed Adelong Gold (ASX:ADG) to recommence operations at Adelong Gold Mine.
Describing that asset as “historic” – a familiar theme for regular market watchers sniffing around the junior explorers – GDM will be the manager of a venture between itself and Adelong (the company) at Adelong (the mine.)
In its heyday, the mine put out 800,000oz of gold. There’s no solid indication the company can replicate that, but, the facts of the past do underscore the geological fertility of the project acreage.
As part of the deal, GDM will acquire a 15% stake in Adelong Gold subsidiary Challenger Mines after spending $300K “on-ground.” That ownership will extend to “51% ownership on production of gold from the Adelong Mine process plant,” the company wrote on Monday.
For GDM’s part, it now has the benefit of being able to boast it’s transitioned from explorer to producer.
In the background of the relationship between Great Divide and Adelong Gold – a partnership they’re calling the Adelong Venture – sits another 68sq.km. of acreage with partial mining approvals.
“GDM was formed to rapidly evolve into a cash-flow mining business. This agreement sets us squarely on the path to producing our first gold in the near-term,” GDM CEO Justin Haines said.
“Working within the Adelong Venture we aim to commence restarting of the existing plant and development of the gold in mine plan this year, then organically expanding the resources and operation.”
This, he says, is a transformational time.
GDM last traded at 26.5%.
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