Emperor Energy (ASX:EMP) is intending to establish a 50/50 joint venture (JV) arrangement with a London-based unlisted company for the purchase and exploration of the Great Caesar mining leases in Queensland.
On 16 October 2023, Emperor executed an asset sale and purchase agreement to acquire three gold mining leases covering a 128-hectare area, located between Townsville and Charters Towers City.
Under the proposed JV deal, the unlisted company is required to complete a $500,000 capital raising, of which $400,000 will be used to complete the mining leases acquisition.
Emperor, which has a $4 million market capitalisation, says the aim of the JV is to complete the acquisition in May 2024, before conducting a stage one drilling program in the second half of 2024.
Upon completing stage one drilling, both parties will reach an ‘equilibrium of expenditure’ on the acquisition and exploration of the mining leases.
The JV arrangements will then take over with the parties holding equal equity positions in the mining leases, under which both companies will share ongoing expenditure and potentially future revenue from the leases on a 50/50 basis.
Emperor says the exploration program involves a two-phase drilling program targeting the outcrop uncovered by previous ‘Great Caesar workings’, as well as a secondary target at the Tunnel prospect.
Stage one involves 600m of drilling, at an estimated cost of $180,000, while the second phase will see an additional 400m of drilling for roughly $120,000.
Upon the completion of drilling, and the satisfaction of certain conditions, the company will finalise mining approvals and begin a contract mining operation in the second half of 2025. Emperor notes this is expected to cost $500,000.
Emperor Energy is a diversified energy company with upstream and downstream assets across Australia.
As of 31 December 2023, Emperor Energy had $186,000 in cash and cash equivalents at hand, according to its latest quarterly report. Post-quarter-end, Emperor conducted a share purchase plan to raise up to $200,000.
Write to Aaliyah Rogan at Mining.com.au
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