Medallion Metals (ASX:MM8) has received interest from several parties to provide development funding of up to $50 million for the Ravensthorpe-Forrestania Gold Project in Western Australia.
Out of 13 parties, seven of the proposals contain offers of development funding linked to offtake rights.
Medallion, which has a market capitalisation of $80.83 million, plans to continue evaluating the indicative proposals and is seeking independent advice regarding the offtake and funding elements of each proposal.
In August 2024, Medallion entered into an exclusivity agreement with IGO (ASX:IGO) to acquire certain assets of the Forrestania Nickel Operation, including the Cosmic Boy processing plant and associated infrastructure. The process is on track to reach binding status within the nine-month exclusivity period.
Subject to reaching binding documents, the company will shortlist the proposals and then seek to progress to an offer capable of acceptance. Medallion says it may also consider funding alternatives that are not linked to offtake.
Enquiries to date include securing offtake rights to the copper-gold concentrate — a key saleable product generated by processing Ravensthorpe’s mineralisation through the flotation plant at Forrestania, as well as gold and silver doré.
Managing Director Paul Bennett says the strong level of interest from potential offtake partners is further endorsement of the development strategy.
“Not only does copper enhance the project’s already attractive economics, the demand for the concentrate product potentially provides access to a funding source capable of establishing the foundation capital piece to underwrite the proposed development,” Bennett says.
Due to the level of interest, the company has formalised the process calling for indicative proposals to purchase the concentrate, subject to closing the proposed transaction and development of the project.
The company notes that the market response that the current concentrate market conditions have implications for Medallion. These include considering modifications to the Cosmic Boy process infrastructure to enable treatment of Ravensthorpe material.
Medallion’s Scoping Study for processing Ravensthorpe ore through the Cosmic Boy plant outlined robust financial metrics including $637 million of pre-tax cashflow generated over an initial five and a half year period, at an all-in sustaining cost of $1,845 per ounce.
Write to Aaliyah Rogan at Mining.com.au
Images: Medallion Metals
