Resources & Energy Group (ASX:REZ) has executed a binding term sheet with QMines (ASX:QML) for the sale of its Mount Mackenzie Gold Project in Queensland.
QMines, which has a market capitalisation of $17.58 million, will acquire Mount Mackenzie Mines, which holds the project, for $2.485 million to Resources & Energy.
The consideration comprises $1 million in cash and 33 million QMines shares at $0.045 per share, equal to $1.485 million cash.
The parties will work towards satisfying the conditions precedent, with completion expected within 10 business days following the satisfaction or waiver of all conditions. Following completion, Resources & Energy will become a significant shareholder of QMines, with exposure to Mount Mackenzie’s development,
Resources & Energy Managing Director J Daniel Moore says this agreement follows the company’s strategic decision to realign its asset portfolio, primarily focusing on expanding exploration and development activities at its East Menzies Gold Project in Western Australia.
Moore adds that this transaction marks a value-accretive exit from the company’s Queensland portfolio.
“It strengthens our balance sheet and allows us to fully commit to advancing the East Menzies Gold Project in Western Australia — our highest priority and most prospective asset,” Moore says.
The transaction is subject to QMines satisfying due diligence and obtaining shareholder approval.
QMines Managing Director Andrew Sparke says the Mount Mackenzie Project aligns with the company’s strategy of building a pipeline of gold and copper assets in Queensland.
“With two advanced projects in the portfolio, we’re well-positioned to drive further growth in one of Australia’s most prospective mining jurisdictions,” Sparke says.
The East Menzies Gold Project, located 130km north of Kalgoorlie, covers a 103km2 area and comprises 50 tenements.
Resources & Energy Group is a Western Australian gold and green metals explorer and developer.
Write to Aaliyah Rogan at Mining.com.au
Images: Resources & Energy Group
