Impact Minerals (ASX:IPT) has executed a joint venture agreement with Kuniko (ASX:KNI) to further exploration at the Commonwealth Project in the Lachlan Province in New South Wales, bringing it to a decision to mine.
The company will receive 3.13 million shares in Kuniko following a due diligence period of two weeks, half of which will be held in escrow for six months, and the other half for one year.
Kuniko will then be required to spend $1.5 million in the first two years of the agreement to obtain 51% interest in the project, which will be accompanied with another $1.5 million in spending across the following two years for a 70% stake.
Leading up to the decision to mine, Kuniko will free-carry Impact’s remaining 30% stake.
Impact will then be required to either contribute or dilute to 10%, converting to the 2% net smelter royalty.
Managing Director Mike Jones says the joint venture will help the company reach two key objectives.
“First, it sees the company retaining a 30% free carried interest to a decision to mine in a project that has significant upside and is the only project in Australia similar to the world-class Eskay Creek Mine in the famed Golden Triangle of British Columbia,” Jones says.
“Secondly, it frees up time and money for the company to continue to increase its focus on the development of the Lake Hope High Purity Alumina (HPA) Project here in Western Australia as well as its investment in Alluminious, owner of the HiPurA technology platform for the production of HPA.”
The Commonwealth Project spans 565km2, hosting a range of deposits prospective for porphyry copper-gold, epithermal gold, and volcanogenic massive sulphide.
During its time as the whole owner of the project, Impact has defined an inferred resource of 88,800 ounces of contained gold and 3.3 million ounces of contained silver, also displaying significant credits of zinc and lead.
Resources remain open at depth and along trend, which Impact believes has the potential for bulk open pit mining.
“We look forward to working with Kuniko as they move towards a drill program to test extensions of the high-grade massive sulphide bodies at Commonwealth itself and the high-grade silver-gold veins at Silica Hill,” Jones says.
“In addition there is a tantalising induced polarisation anomaly below Commonwealth in an area of increasing copper values in drilling and which is a target for a large porphyry copper system similar to the nearby Boda-Kaiser discovery.”
Impact Minerals is an Australian explorer focused on establishing itself as a ‘key player’ in the High Purity Alumina industry.
Write to Maddison Elliott at Mining.com.au
Images: Impact Minerals
