WIN Metals (ASX:WIN) has signed a binding memorandum of understanding (MoU) with privately held Top Global Mining to acquire the Radio Gold Mine in Western Australia.
Under the MoU, WIN will pay a $50,000 non-refundable deposit, as well as pay a $500,000 cash payment to the vendor. The company will also issue $400,000 worth of shares issued at $0.02 per share.
The vendor will also be granted a 5% net smelter return royalty from the sale of gold, up to 18,000 ounces, with a trailing 1.5% royalty thereafter in perpetuity from the sale of gold mined from Radio.
The Radio Gold Mine, comprising a portfolio of tenements as well as an extensive range of mining and processing assets, is ready to resume operations with key infrastructure established.
WIN, which has a market capitalisation of $11 million, says it is envisioning a new strategy for this asset, which aims to capitalise on the investment of more than $30 million previously made in the mine by the former owners.
CEO Steve Norregaard says Radio is capable of generating near-term cashflow harnessing the current elevated gold price.
“The site is fully prepared to restart underground production, with a partially completed processing facility and significant operations ready infrastructure that has the potential to allow WIN to consider the option of processing its own ore and reducing dependence on delayed payments often associated with toll milling,” Norregaard says.
“This acquisition provides an opportune stepping stone for WIN, elevating the company to the ranks of a producer at what was once the highest grade producing gold mine in Western Australia.
“WIN will initially evaluate short-term open pit opportunities near existing workings at Radio Repeater, Radio South, and the central near-surface Radio resource. These targets, believed to have been previously overlooked, could potentially deliver immediate cashflow.”
The company intends to drill test these areas in the near-term to support a resource update and subsequent open pit mining studies.
Radio has a resource comprising 210,000 tonnes @ 4.23 grams per tonne gold, totalling 28,600 ounces of gold. Since the 2018 resource estimate, Resources & Energy Group (ASX:REZ) mined and processed 3,193 tonnes of ore grading 5.66g/t gold, producing 581 ounces of gold.
The company is exhibiting at this year’s Diggers & Dealers Mining Forum. Mining.com.au is again attending the event.
Write to Aaliyah Rogan at Mining.com.au
Images: WIN Metals
