THE BOURSE WHISPERER: Genesis Minerals Limited (ASX: GMD) has entered into a binding agreement to acquire 100 per cent of the Kookynie gold project, located immediately south-east of the company’s 100 per cent-owned Ulysses gold project in Western Australia.
Genesis Minerals will part with $13.5 million to pick up the project, comprising a $3 million upfront cash and share payment with the full balance of $10.5 million due in six months, plus a one per cent net smelter royalty (NSR) capped at $5 million.
The tenement package includes a JORC 2012 Indicated and Inferred Mineral Resource of 8.53 million tonnes at 1.5 grams per tonne gold for 414,000 ounces.
This will take the total Mineral Resource of the Greater Ulysses project to 17 million tonnes at 2.34g/t gold for 1.28 million ounces, providing a strong foundation for the next stage of Genesis’ development as a future mid-tier Australian gold company.
“This is an acquisition which ticks every box for us from a strategic, corporate, geological and tactical perspective,” Genesis Minerals managing director Michael Fowler said in the company’s announcement to the Australian Securities Exchange.
“It provides the springboard for a significant re-boot of the Genesis story and puts us on a firm growth trajectory towards the establishment of a significant new standalone gold mining and processing operation at Ulysses.
“The acquisition consists of two distinct parts.
“The northern tenement package represents the immediate south-eastern extension of the Ulysses project, consolidating our ownership of this highly prospective gold corridor.
“It gives us an immediate opportunity to in-fill and extend the current Resources at the Admiral, Butterfly and Clark deposits – drawing on the geological IP we have developed on our neighbouring ground at Ulysses.
“We see enormous potential to extend the existing Resources down-dip, to find new high-grade lodes just as we did at Ulysses, and to make potential new discoveries and find parallel structures along strike.
“The package being acquired also offers vast regional exploration upside, including along the under-explored southern tenement package, providing us with a pipeline of both near-mine and regional exploration targets.”
Genesis Minerals indicated that for the remainder of CY2020, the company will be focusing on a combination of resource definition and expansion drilling to feed into a Feasibility Study on the development of a standalone gold operation at Ulysses, with ore to be sourced from a combination of known underground and open pit Resources.
Genesis is targeting completion of this Feasibility Study in the first quarter of CY2021.