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Neometals (ASX:NMT) is teaming up with BML Ventures for a production joint venture at the Ironclad Gold Deposit in Western Australia, provided they get through proper due diligence and mine planning in the next 90 days.
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Under today’s proposed deal, BML will fund and manage open-cut mining, haulage, and toll-milling operations at Ironclad. In return, the developer will recover the agreed costs from net product sales, after which profits will then be split between Neometals (through Avanti Exploration) and BML.
“This partnership significantly de-risks development,” Neometals MD Chris Reed explained today. “It enables early value creation and supports long-term strategy.
“We’re pleased to partner with BML. We’ve had a long history with their principals, and their demonstrated capability gives us strong confidence in realising Ironclad’s potential… [we have] a clear, fully-funded pathway to early production.”
Ironclad is already well-primed for the joint venture to progress things quite quickly; it hosts an Inferred Mineral Resource of approximately 250,000 tonnes at 1.6 grams per tonne gold for 13,000 ounces, above a 0.5g/t cutoff.
Neometals has also just recently completed a 42-hole RC infill and extension, with an updated MRE expected to come in around March next year. (Assay results for that update will come in around January, the company says.)
Ironclad sits right in the Barrambie Greenstone Belt, which has had historic gold production and limited modern exploration. Neometals had first started its preliminary exploration across Barrambie a little earlier this year.
Technical work between the two Aussie companies through due diligence will include a revised resource model, as well as an Ironclad mine plan.
This week’s Neometals-BML letter of intent covers mining licence application M57/674, which is about five square kilometres within the broader 505-square-kilometre Barrambie tenure. Data access, reporting protocols, budgeting procedures, audit rights, security, and rehab responsibilities were also all included.
This is the second partnership BML has entered in early December; the first saw them draw up a profit-sharing agreement with GoldArc Resources (ASX:GA8) to fast-track the Mt Stirling prospect into development.
NMT shares have been 5.6cps after little movement. BML isn’t listed.
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