Alliance Resources Limited (ASX: AGS) is an emerging uranium producer whose core asset is a 25% free carried exploration interest in the Four Mile Uranium Project in South Australia.
The Four Mile Uranium Project is west of the Beverley Mine and is perhaps the highest-grade roll-front deposit in the world. The western zone of Four Mile already has an Inferred Resource of 15,000 tonnes (32Mlbs) U3O8.
Alliance Gold sells Maldon Gold to focus on Four Mile uranium
Alliance Resources (ASX: AGS) has entered into an agreement to offload uranium and gold producer Maldon Resources to Drummond Gold.
The agreement will allow Alliance to focus on the Four Mile uranium project, located 550 kilometres north of Adelaide in South Australia.
Alliance managing director Patrick Mutz said the transaction was a win-win for both companies. Under the agreement Alliance will receive 88.4 million ordinary shares in Drummond for the sale of Maldon.
The consideration for the transaction was based on a share price of 6.1 cents.
The agreement is subject to certain terms and conditions, including the approval of shareholders of Drummond, all necessary consents and approvals as required under the Corporations Act and the ASX Listing Rules, and the raising of at least $3 million by Drummond on or before 30 November 2009.
The Maldon Gold Project is 30 km southwest of Bendigo and has produced historically a total of 1.75 million ounces of gold at an average grade of 28 g/t.
Alliance undertook major development work at Maldon aimed at bringing the Alliance South gold lode into production, however, development was suspended late last year to conserve cash to meet Alliance’s commitments to the Four Mile Uranium Project.
The decline and other mine infrastructure are fully maintained and the project also includes an operational-ready CIL gold treatment plant.
The combined mineral resource inventory for Four Mile East and West deposits is 61 million pounds U3O8 (28,000 tonnes) at an average grade of 0.35% (3,500 ppm) U3O8.
