Since 2004, over $180 million has been invested in underground development, surface infrastructure and the processing plant.
Historical production at Hillgrove exceeds 730,000 ounces of gold and 50,000 tonnes of antimony plus tungsten as a by-product.
The project also has a JORC 2012 compliant resource of 459,000 ounces of gold grading 5.1 g/t and 48,000 tonnes of antimony grading 1.7%.
Near-production high-grade gold asset with quality resources and infrastructure
Red River’s managing director Mel Palancian said: “We have been working on the acquisition of the Hillgrove Gold-Antimony Project for over six months and it’s a great addition to our portfolio.
“We love gold and bringing mining assets back to life cheaply. It’s rare to find a high-grade gold asset that is close to production with quality resources and infrastructure.
“We can fund near term commitments from our strong existing cash balance and ongoing cash flow.
“We will continue to focus on production and growth at Thalanga as there is an exciting future ahead with significant growth potential.
“For Hillgrove, we will ensure a smooth transition of the asset and evaluate the opportunities by upgrading and growing resources and developing an optimised restart study.”
READ: Red River Resources aims to extend Thalanga base metals production and mine life with targeted drilling program
Consideration for the acquisition is $4.0 million Red River shares priced at the 10-day VWAP up until 2 July 2019.
The shares will be held in escrow for 12 months.
The transaction is subject to obtaining the state government written approval to the acquisition of four exploration licences as per regulatory requirements.
Red River has a track record of restarting and operating underground mines
The successful redevelopment and restart of mining operations at Red River's flagship Thalanga Zinc Project in Queensland demonstrates why Hillgrove is an a large-scale opportunity for Red River.
Red River's low-capital acquisition and development of Thalanga has generated material value for the company and it aims to replicate that success with Hillgrove.
The next steps at Hillgrove involve appointing a management team and evaluating potential synergies with the Thalanga operation.
This will be followed by exploration which will lead into a restart study.