Capricorn Metals will soon add a third gold mine to its Western Australian portfolio after striking a deal with Finnish explorer Latitude 66.
Under a new agreement, Capricorn will take over the Sylvania project in the Pilbara, located just a stone’s throw (60km west) from the Karlawinda gold mine.
The project boasts 13 already-granted exploration licences across 2247km2, with recent data from the Geological Survey of Western Australia showing two major fault structures that potentially act as the “feeders” of all the major gold projects in the area.
Latitude 66 managing director Grant Doyle said the sale is the perfect match for Capricorn and will allow Latitude to focus on its Finnish assets.
“With its nearby Karlawinda operation, Capricorn Metals Limited is a logical buyer for the Sylvania project and we are pleased to be realising latent value for shareholders from this non-core asset,” Doyle said.
Capricorn will pay a total $1.65 million for the project, with $1.5 million to be paid at the completion of the transaction.
A further $750,000 will be payable should Capricorn establish a JORC-compliant mineral resource estimate of 200,000 ounces or more of gold at Sylvania.
Capricorn will then pay another $750,000 to Latitude should the company decide to commence mining.
Once the deal is complete, Capricorn will also be required to pay Latitude a one per cent net smelter (NSR) return royalty on the sale of all precious minerals and a 1.5 per cent NSR royalty in respect of the sale of non-precious minerals extracted from the project’s tenements.
The transaction is set to complete by the end of the week.
Capricorn recently raised $200 million to support the expansion of Karlawinda and its Mt Gibson project in the Murchison region.
It’s all part of Capricorn’s plan to become a 300,000 ounce per year gold producer, which is supported by its current 3.3 million-ounce reserve base across its projects.
Subscribe to the Mining newsletter to get the latest news that matters to Australia’s premier industry.
