Twenty Seven Co Ltd (ASX:TSC) has entered into a binding term sheet with an exclusive option to acquire Oz Gold Group Pty Ltd and the rights over two highly prospective gold projects - Mt Dimer in WA and Trident in NSW.
To fund the option payment, TSC has raised $500,000 from a placement of 100 million shares at $0.005 per share with an attaching one for two 1.5 cents option.
Shares have been as much as 80% higher on the news to 0.9 cents on volume of more than 302 million.
Chairman Rob Scott said: “Acquiring the option over the Mt Dimer and Trident projects is an exciting opportunity for TSC, potentially delivering an advanced gold project to the company and further exploration upside.
“Moreover, the new projects complement the existing portfolio which comprises the Rover, Mundi Mundi and Midas projects.
“Notably, the mining lease within the Mt Dimer tenure package is a high priority for TSC, given the historic ore grade mineralisation reported.
“We look forward to bringing the market more news about these exciting new developments once we finalise our due diligence, in addition to further updates on our Rover project.”
Mt Dimer Gold Project
The advanced Mt Dimer Gold Project lies 200 kilometres north of Southern Cross in WA’s Goldfields and south of the Rover Project and comprises a mining lease (M77/515) and two exploration licences.
Historic open-cut mining to 80 metres in the 1990s produced about 8,500 ounces of gold with around 77,000 tonnes of oxide ore processed at 3.44 g/t gold.
Best intercepts from historic drilling campaigns include:
- 27 metres at 4.26 g/t from 37 metres;
- 19 metres at 3.38 g/t from 76 metres;
- 11 metres at 5.29 g/t from 81 metres;
- 8 metres at 4.71 g/t from 72 metres;
- 7 metres at 3.27 g/t from 61 metres;
- 7 metres at 3.55 g/t from 35 metres;
- 7 metres at 3.97 g/t from 84 metres;
- 6 metres at 13.32 g/t from 99 metres;
- 6 metres at 22.30 g/t from 99 metres;
- 5 metres at 10.64 g/t from 78 metres;
- 5 metres at 5.23 g/t from 33 metres;
- 4 metres at 4.91 g/t from 150 metres;
- 2 metres at 8.65 g/t from 77 metres; and
- 2 metres at 4.58 g/t from 81 metres.
Potentially, economic remnants of oxide ore could facilitate a resumption of open pit operations, while processing on-site stockpiles may be a source of early-stage cashflow.
Mt Dimer and Rover gold Projects in WA
Potential exploration upside
The two exploration licences build scale on the mining lease’s prospectivity and deliver additional exploration potential:
- E77/2383 immediately to the west of the mining lease enhances prospectivity as it covers a continuation of the prospective sequence; and
- E77/2442 is around 80 kilometres north-west of the mining lease and also highly prospective for gold mineralisation and is yet largely under-explored.
Additionally, E77/2442 EL is adjacent to Ramelius Resources’ (ASX:RMS) Marda Gold Project which, at June 2019, had JORC compliant probable ore reserves at 1,100,000 tonnes at 2.5 g/t for 89,000 ounces gold, with metallurgical test-work showing the ore is free milling with solid gold recoveries.
Trident Gold-Copper Project
The Trident Gold-Copper Project in NSW is 35 kilometres northeast of Broken Hill, is home to a historic gold mine and complements TSC’s Midas and Mundi Mundi assets.
This project delivers significant exploration upside with tenements M77/515, EL77/2383, EL77/2442 and EL8736.
Trident hosts numerous historic workings (including four pits) and gold-copper surface occurrences with assayed rock chips ranging up to 2.61 parts per million gold and 18.57% copper respectively.
The Horrie Hoare’s historic gold mine is within the tenure boundaries and consists of a series of shafts and pits (only around 10 metres deep) that contain gold-copper-lead-silver mineralisation.
Further follow-up has revealed anomalous schist comprising 0.75 metres at 11.45% lead, 191 g/t silver and 0.7g/t gold that demonstrates the tenure is prospective for traditional Broken Hill style mineralisation.
Gold-copper surface occurrences at the Trident Project in NSW
Oz Gold option terms
TSC has an exclusive and irrevocable 60-day option to acquire all of the shares in Oz Gold from the vendors.
In exchange for being granted the option, TSC will (within 2 days of executing the BTS), make a non-refundable option payment of $200,000 to the vendors, which will be applied by the vendors towards satisfying Oz Gold’s similar obligations in respect of the Oz Gold option.
Upon the exercise of the option, TSC will cause Oz Gold to exercise the Oz Gold option and will pay an upfront cash payment and make an issue of fully paid ordinary shares in TSC to the vendors.
The exercise of the option is subject to TSC completing satisfactory due diligence investigations in relation to Oz Gold and the tenements and obtaining all necessary regulatory and shareholder approvals.
TSC company has received commitments for $500,000 from professional and sophisticated investors to subscribe for 100 million new shares in the company at an issue price of 0.5 cents per share, representing a 4.36% discount to the 15-day volume-weighted average price.
Investors in the placement will be offered one free attaching unlisted option for every two shares subscribed for, exercisable at 1.5 cents and expiring on December 31, 2022.
Placement proceeds will be used to satisfy the option fee and for general working capital.
In the near-term the company’s plans include:
- Completing due diligence for the Mt Dimer and Trident projects over the next 60 days;
- Pursuing relevant regulatory and shareholder approvals with a view to exercising the option to acquire Oz Gold;
- Commencing work on high-level exploration plans for mining lease within the Mt Dimer Gold Project; and
- Continuing exploration at the Rover Project in WA.