- Today, Sky Metals has entered a farm-in agreement with Heron Resources
- Under the farm-in, Sky will buy three tenements over two projects in New South Wales
- This is part of Sky’s gold strategy of finding targets similar to a 2 million ounce gold discovery
- Sky will earn an 80 per cent interest by spending $400,000 on mining within 12 months
- Sky Metals share price is up 22.8 per cent today with shares trading at 9.7 cents apiece
- Heron Resources share price is slightly down 5.13 per cent with shares trading at 18.5 cents apiece
Sky Metals has acquired several advanced high-value gold opportunities as part of its New South Wales gold strategy.
The mineral resources company is focused on finding and testing advanced McPhillamys-type gold targets in the Late Silurian stratigraphy of New South Wales.
The McPhillamys-type is based on the discovery of the McPhillamys Gold Deposit which has a mineral resource of 60.1Mt at 1.05g/t Au for 2.03 million ounces.
As part of its gold strategy, Sky has today entered a farm-in agreement with Heron Resources for three of Heron’s tenements in eastern NSW.
The farm-in is for two project areas including Cullarin and Kangiara. Under the agreement, Sky may earn up to an 80 per cent interest in the projects prior to forming a joint venture.
Kangiara includes the EL8400 and EL8573 tenements. The project is located 30 kilometres northwest of Yass in central NSW.
The area comprises volcano-sedimentary rocks of the Silurian Douro Group and is considered prospective for a range of gold-copper-zinc mineralisation types.
In the early 1900s, Kangiara produced approximately 40,000 tonnes at 16 per cent lead, 3 per cent copper, 5 per cent zinc, 280 grams per tonne of silver and 2 grams per tonne of gold.
Cullarin is located 25 kilometres west of Goulburn in central NSW. Like Kangiara, Cullarin is prospective for gold-copper-zinc mineralisation.
Drilling conducted in the late-1980s highlighted McPhillamys-style gold results including: 142.1 metres at 0.89 grams per tonne of gold (WL28) including 12 metres at 4.4 grams per tonne of gold from 25.9 metres at the Cullarin Project.
“The acquisition complements the current strategy of identifying high value tin opportunities and leverages the exploration team’s significant combined experience during the discovery of the McPhillamys Gold Deposit, being an economically important and under-explored target style in NSW,” Sky Metals CEO Peter Duerden said.
To gain an 80 per cent ownership, Sky will need to spend $400,000 within 12 months, and a total of $2 million over three years.
On completion, Heron will be free carried at its 20 per cent interest until a definitive feasibility study is completed or $10 million of total expenditure is reached.
Heron will receive 10 million Sky options at a strike price of 15 cents and exercisable when Sky proceeds to a $2 million farm-in stage.
“The agreement provides Heron an opportunity to generate value from a number of non-core tenements whilst it focusses on the business of maximising the return from our operations at Woodlawn,” Heron Chairman Stephen Dennis said.
Sky Metals share price is up 22.8 per cent today with shares trading at 9.7 cents apiece as at 2:12 pm AEST.
Heron Resources share price is slightly down 5.13 per cent with shares trading at 18.5 cents apiece.