THE BOURSE WHISPERER: Metals X (ASX: MLX) has signed a binding Heads of Agreement (HoA) with RNI NL (ASX: RNI).
The deal will result in Metals X acquiring the Grosvenor gold project, the Horseshoe project and part of the Peak Hill project – all located in the Bryah Basin of Western Australia from RNI.
Metals X said the projects include gold prospects hosting a resource base of over 2 million ounces as well as the one million tonnes per annum Grosvenor gold process plant, plus substantial infrastructure including a 100 person village, air strip and borefield.
Metals X explained that RNI has been working up the project in conjunction with its copper exploration, however funding and financing issues had, as Metals X delicately described – “stifled its progress”.
“This is a great acquisition for Metals X in a similar style to several the company has made in the past two years,” Metals X CEO Peter Cook said in the company’s announcement to the Australian Securities Exchange.
“We have acquired a substantial gold resource base with all the plant and infrastructure in place for an exceptional price.
“It presents as another low-cost and low-risk gold production opportunity with a lot of upside. It is a good fit to the company’s portfolio and will benefit from some synergistic benefits from our Central Murchison gold project at Meekatharra, which is currently in the development phase.”
Payment for the acquisition involves Metals X allotting 18 million new fully paid ordinary shares in the company to RNI along with a $300,000 interest free loan to RNI for working capital during the sales process which is convertible into shares in RNI at the price of its next capital raising.
The binding HoA also grants Metals X a first right of refusal on any future sale of its existing copper or gold assets by RN
It’s not all one way traffic, however with Metals X agreeing to sell off its Chunderloo copper-gold project at Meekatharra into RNI for a consideration of 25 million new fully paid RNI shares.
This pick-up complements RNI’s existing portfolio of the Cashmans, Morck’s Well and Doolgunna projects and the Peak Hill copper interests.
RNI considers these tenements to host a combined strike of some 120 kilometres of prospective volcanic hosted massive sulphide (VHMS) target horizons.
Previous exploration work carried out by RNI has already identified a series of high-priority copper targets across these project areas.