Intermin Resources Limited (ASX:IRC) is divesting two projects in WA’s north-eastern Goldfields to fully focus on its core standalone gold project in the Kalgoorlie and Coolgardie regions.
Agreement has been reached with Kingwest Resources Ltd (ASX:KWR) for the $8 million sale of Intermin’s Menzies and Goongarrie gold projects, 80 to 130 kilometres north of Kalgoorlie-Boulder.
Kingwest will pay $3.375 million in cash and the equivalent of $4.625 million in Kingwest shares.
The acquisition comprises 38 mining, prospecting and exploration licences and includes a current JORC-compliant resource of 195,000 ounces.
“Divestment supports objective”
Intermin’s managing director Jon Price said: “Intermin’s core focus is firmly set on developing a standalone gold project in the Kalgoorlie and Coolgardie regions.
“This divestment supports this objective while retaining exposure to both Menzies/Goongarrie and Kingwest’s current gold projects in the north-eastern Goldfields.”
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Intermin will become a substantial Kingwest shareholder with board representation in a non-executive capacity.
It will also have a right to process or purchase any gold-bearing ore from the tenements under standard commercial terms.
The transaction is subject to Kingwest completing a $4 million capital raising and other standard conditions.
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Price said: “The deal is another step in Intermin’s strategy of monetising assets through mine development or generating value through the divestment of lower priority projects to support future growth plans and minimising shareholder dilution wherever possible.
“We look forward to working with the Kingwest team, which is an active gold explorer in the region with an excellent technical team, prospective assets and strong financial backing.”
Intermin’s project locations, regional geology and surrounding infrastructure.
Intermin’s current focus is on completing a consolidated feasibility study and advancing mine development and production plans.
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This study will include assets from the recent merger with MacPhersons Resources and will potentially incorporate the Coolgardie Gold Project, which the company is acquiring.
The payment structure of the Kingwest agreement enables the purchaser to fund exploration while providing cash and shares to Intermin broadly aligned with the proposed payment structure for the potential Coolgardie Gold Project acquisition.
