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Rox Resources Limited

Rox Resources and Venus Metals join forces to acquire Youanmi Gold Mine

Rox has entered a binding term sheet that results in three joint ventures being formed.

aerial shot of Youanmi gold mine and surrounding area
Youanmi has historically produced an estimated 667,000 ounces of gold grading 5.47 g/t

Rox Resources Ltd (ASX:RXL) is entering three joint ventures with Venus Metals Ltd (ASX:VMC) focused on the Youanmi Gold Mine and surrounding area.

The key JV will see Rox acquire an initial 50% interest in the Youanmi Gold Mine, known as the OYG Joint Venture.

Rox will manage the OYG Joint Venture and also have the ability to increase its stake to 70%.

The OYG Joint Venture area covers 65 square kilometres surrounding the 1.19-million-ounce Youanmi Gold Mine, which is on care and maintenance.

Rox plans to undertake an aggressive near-mine exploration program and pre-development work at Youanmi immediately following the transaction's completion.

READ: Rox Resources hunts pre-development projects as it focuses on gold assets

Rox’s chairman Stephen Dennis said: “The acquisition of the Youanmi Gold Project is consistent with the company’s stated objective of acquiring near-production assets within its financial capacity.

“Since our new CEO Alex Passmore joined the company, our efforts to identify a suitable development project have increased and we look forward to realising the potential we believe exists at Youanmi.”

Notably, the mine ceased operating in 1997 when the gold price was just above A$400 per ounce.

The site infrastructure includes a CIP process plant (requiring significant refurbishment) which was designed to treat 600,000tpa of oxide ore, a tailings disposal facility, mine offices, combined core shed and workshop, mine village, access roads and airstrip.

Two other joint ventures also formed

The agreement between Rox and Venus also sees two other joint ventures formed, the VMC Joint Venture, and the Youanmi Joint Venture.

These joint ventures give Rox the right to earn 50% and 45% respectively of the gold rights on those tenements.

The VMC Joint Venture covers 302 square kilometres while the Youanmi Joint Venture area covers 270 square kilometres.

These two regional joint ventures extend the length of tenure to 40 kilometres of strike along the Youanmi Shear Zone.

Low cost entry into the joint ventures

To enter the main OYG Joint Venture, Rox will pay $2.8 million cash up front along with a 0.2 million scrip component and exploration spend.

To gain its interest in the two regional joint ventures it must spend $1 million within 12 months.

Quick facts: Rox Resources Limited

Price: $0.03

Market: ASX
Market Cap: $32.28 m
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