Cazaly Resources (ASX:CAZ) has signed a binding term sheet with Brightstar Resources (ASX:BTR) for an option to earn up to 80% in the Goongarrie Gold Project in Western Australia.
The Goongarrie Project covers 12km of the Bardoc Tectonic Zone which is the northern extension of the Boulder-Lefroy Shear Zone to the south. The Boulder-Lefroy Shear Zone is considered one of the richest gold mineralised structures in the Yilgarn Craton.
If Cazaly chooses to exercise the option, the explorer will spend an initial $1 million on exploration within 12 months to earn a 25% interest. The company can then choose to increase its interest to 51% by committing to another $1 million spend within a further 18 months.
Cazaly then has the option to acquire the full 80% by spending a final $1 million within a further 18 months. Once Cazaly has earned an interest in any of the three stages, both companies will form a joint venture to explore and potentially develop Goongarrie.
Managing Director Tara French says the Goongarrie Gold Project presents Cazaly with an opportunity to explore for new resources in a multi-million-ounce gold district.
“The sizeable land package has multiple gold targets and is largely untested at depth,” French says.
“With the gold price breaking $4,600 per ounce for the first time, and with a positive pricing outlook, it’s the perfect time for Cazaly to get back into gold.”
Brightstar, which has a market capitalisation of $250.93 million, says its focus is primarily on the general Menzies area as it defined a large open pit mining complex as part of its Definitive Feasibility Study (DFS).
The earn-in allows Brightstar to prioritise operational and development activities, with DFS workstreams advancing and current mining operations at Second Fortune complemented by start-up works at the Fish underground project
As such, Brightstar Managing Director Alex Rovira says Cazaly will be able to explore the Lake Goongarrie area in greater detail, while Brightstar retains exposure and upside to exploration success.
“With our focus on development and mining operations across the broader Eastern Goldfields and Murchison regions, we are delighted to have attracted a quality partner in Cazaly to explore the Lake Goongarrie area in greater detail, while retaining exposure and upside to exploration success with the joint venture,” Rovira says.
“Our focus in the general Menzies area is on the Lady Shenton System where we are defining a large open pit mining complex as part of our DFS, whilst we continue to explore and assess other deposits such as Yunndaga and the Link Zone for future mining opportunities to increase our operational footprint in the Menzies area.”
Cazaly has sourced all of the available historical data from the Goongarrie Project and is validating and compiling it for review. Once due diligence is completed and Cazaly chooses to proceed with a joint venture, the company intends to rank all of the gold targets in order of prospectivity.
Upon completion, an exploration program will be designed to progressively test prioritising gold drilling targets. A drilling program will also begin once all approvals are in place, including heritage, environmental, and drilling approvals.
Cazaly Resources is a diversified mineral explorer with assets in Australia, Canada, and Namibia. The company’s projects are considered prospective for copper, base metals, precious metals, rare earths, and lithium.
Write to Aaliyah Rogan at Mining.com.au
Images: Cazaly Resources
