Pacgold (ASX:PGO) has entered into a farm in agreement with privately held Hardrock Mineral Exploration to acquire the St George Antimony Project in North Queensland.
The St George Project, covering 905km2, hosts a historical antimony mine that has produced 60 tonnes grading 60% antimony from artisanal open cut and underground workings. No modern drilling has been undertaken on the project.
As part of the deal, Pacgold – which has a market capitalisation of $14.47 million – will pay $200,000 in cash and issue 10 million shares to Hardrock.
Under the first stage of the agreement, an initial 51% interest will be earned upon spending a minimum of $250,000 within 12 months and not less than $1.5 million within 24 months.
As part of stage two, a further 29% interest will be earned upon Pacgold completing a Bankable Feasibility Study on a resource that exceeds more than 200,000 ounces of gold-equivalent on or before 22 August 2031.
During stage three, the remaining 20% interest will be earned by Pacgold electing to acquire the stage three interest within one year from the date the company acquired the stage two interest.
Hardrock will also be granted a 2.5% net smelter return (NSR) royalty on antimony and a 1.5% NSR on gold. Pacgold has the right to purchase 50% of each royalty at its election based upon a third-party valuation.
Managing Director Matthew Boyes says this deal gives the company exposure to a highly prospective, historically mined antimony asset in close proximity to the Alice River Gold Project.
“With the price of antimony recently reaching US$60,000 per tonne and the extremely high-grades confirmed from due diligence sampling, there is potential to unlock significant value at this underexplored project through systematic exploration, which we will commence immediately across the multiple high-grade targets already identified,” Boyes says.
“With heritage clearance recently completed by the Hardrock team, we’re looking forward to working with the local stakeholders and traditional owners to create a partnership that benefits all parties as we move into full-scale exploration.”
First-pass mapping and reconnaissance work is planned and will begin in parallel with a regional soil program and a gravity survey over the areas of known “high-grade” and anomalous zones of mineralisation.
Once geophysical targeting and further mapping is completed, the project will be drill tested.
Follow-up geological mapping, rock chips, trenching, and geophysics of existing prospects will also be carried out to build a series of ranked walk-up targets across the entire project area.
Pacgold is a junior mineral explorer focused on its Alice River Gold Project situated at the northern end of the Northeast Queensland Mineral Province. Alice River comprises 377km2 of granted exploration permits and mining leases.
Write to Aaliyah Rogan at Mining.com.au
Images: Pacgold
