Cohiba Minerals Limited (ASX:CHK) has announced that it has secured a farm-in agreement with a subsidiary of unlisted public junior explorer White Tiger Resources Ltd to earn up to a 51% interest in the Warriner Creek Project in the Gawler Craton.
The 346km² Warriner Creek Project comprises 2 exploration licences covering a “highly strategic” iron oxide copper gold (IOCG) target area in the Gawler Craton. The deal adds additional exploration areas to Cohiba’s South Australian portfolio, alongside existing Olympic Domain Projects.
“For some time the Company has been reviewing a number of possible opportunities in relation to expanding its presence in the Gawler Craton”
Cohiba describes Warriner Creek as “aligning perfectly” with its Gawler Craton focus, with initial exploration requiring only two 400-600m deep holes prior to committing to additional expenditure.
The company is working on existing exploration programs at Horse Well, Pernatty C and Lake Torrens.
Exploration will be funded through cashflow, with the company holding $6.5 million as at 30 June 2021.
The agreement will see Cohiba commit to a minimum spend of $600,000 during the 12 month Initial Period to assess prospectivity of the project via a 600m and 400m hole.
Pending positive results, Cohiba would then have a 24 month Stage 1 period to spend an additional $2,400,000 on exploration activities to earn a 51% interest.
Cohiba will also be required to pay a $250,000 “JV Formation Payment”, a $100,000 “JV Licence Fee” upon formation of the joint venture plus a further $100,000 on each anniversary date, along with a $250,000 “Stage 1 License Fee” upon commencing Stage 1 plus an additional $250,000 on the first anniversary, assuming that Cohiba has not withdrawn from the agreement.
Cohiba Minerals CEO Andrew Graham said: “For some time the Company has been reviewing a number of possible opportunities in relation to expanding its presence in the Gawler Craton and establishing itself as one of the premier IOCG explorers in the region. The Warriner Creek Project presented itself as a strategic opportunity and, following significant investigation, it was determined that this project would greatly complement the Company’s existing IOCG portfolio.
The Company remains absolutely committed to its exploration programs at Horse Well, Pernatty C and Lake Torrens and regards the Warriner Creek Project as a great addition to the group. With an ever-increasing awareness of the prospectivity of the region, IOCG target areas are at a premium and as such it was considered timely to enter into this Farm-In Agreement and secure the right to explore. The Company wishes to thank the White Tiger team for its hard work in helping to establish this strategic partnership and looks forward to forging a strong working relationship”
Images: Cohiba Minerals Limited