Matsa Resources (ASX:MAT) has signed a tenement option agreement with AngloGold Ashanti (NYSE:AU) for the sale of the Lake Carey Gold Project in Western Australia.
The Lake Carey Project, covering 449km2, sits within the Laverton tectonic zone in Western Australia. The project includes three gold mines — the underground Red October, Fortitude, and Devon Pit mines — which are on care and maintenance but excluded from the acquisition.
AngloGold intends to purchase Lake Carey for a total of $101 million, subject to satisfying certain conditions, which will include an $8 million option fee payable in four installments.
The transaction also includes AngloGold paying a $73 million option exercise fee, as well as a $20 million deferred payment that Matsa is entitled to if any JORC-compliant resources are discovered on the tenements.
Matsa intends to use the funds to advance its remaining assets, including bringing the Devon Pit Gold Mine to near-term production and further exploration at the Fortitude North Project.
Following today’s announcement, Matsa’s share price spiked 45.28% to $0.077 as of 11am AEDT.
Executive Chairman Paul Poli says this transaction is a culmination of negotiations over the past 12 months.
“To attribute a value of $101 million to the Lake Carey Gold Project speaks volume for the exploration potential of this project,” Poli says.
“Not only that, Matsa retains the highly valuable, near-term production Devon Project, Red October Accommodation Village and what I consider to be a very exciting exploration project in Fortitude North, where recent drilling highlighted its potential.”
Matsa is now seeking to meet all the conditions required and do all things necessary to ensure it meets its obligations to complete the transaction.
AngloGold Ashanti is an independent and global gold mining company with a diverse portfolio of cooperation, projects, and exploration activities.
Matsa Resources is an explorer and gold mining company operating south of Laverton in the northeastern goldfields of Western Australia.
Write to Aaliyah Rogan at Mining.com.au
Images: Matsa Resources
