THE BOURSE WHISPERER: Cassini Resources (ASX: CZI) has executed a Sale and Purchase Agreement to acquire 100 per cent of the West Musgrave project in Western Australia.
Cassini is acquiring the project from BHP Billiton Nickel West and BHP Billiton Minerals, two subsidiaries of BHP Billiton (ASX: BHP).
The project area contains the Nebo and Babel sister deposits and the Succoth advanced copper exploration prospect as well as other highly-prospective exploration targets.
BHP Billiton’s West Musgrave project identifying major deposits and prospects. Source: Company announcement
Cassini is to pay $250,000 in cash, 10 per cent of which has already been paid, as a deposit.
The balance will be payable by Cassini upon completion of the acquisition.
A two per cent net smelter royalty will apply to the net proceeds from future production from the tenements within the project plus a production milestone payment due 12 months after production from the project commences, amounting to $10 million in cash.
“These are truly significant assets, and it is a great result for Cassini to have been successful in acquiring them,” Cassini Resources managing director Richard Bevan said in the company’s announcement to the Australian Securities Exchange.
“Nebo‐Babel was a very prominent discovery for WMC in the early 2000s and is widely regarded as a world‐class deposit.
“As a smaller company, we can apply a different, innovative approach to these assets, focussing on higher‐grade opportunities, with the aim of progressing their development to production as a priority.
“We believe significant value can be generated for our shareholders in a reasonably short time frame.
“We foresee that a number of significant project milestones are capable of being achieved within the next ix to twelve months.”
Nebo‐Babel was first discovered by Western Mining in 2000, when the discovery hole intersected 26.55 metres at 2.45 per cent nickel, 1.78 per cent copper, 0.74 grams per tonne PGE and gold.
Cassini believes Nebo‐Babel has production potential as a smaller, higher‐grade operation.
Located 13 kilometres northeast of Nebo‐Babel, the Succoth prospect was a copper discovery and was the subject of a fair bit of market speculation during early 2013 dues to its size and continuity of mineralisation, which Cassini considers to provide large‐scale mining potential.
Limited drilling (approximately 35RC and diamond drill holes) undertaken at Succoth to date includes results such as:
245.6m at 0.69 per cent copper, 0.06 per cent nickel, 0.16g/t platinum and palladium from 64.4m (WMN4054).
The system is open at depth.