THE BOURSE WHISPERER: Middle Island Resources (ASX: MDI) has signed an Option Deed to acquire a 100 per cent interest in the Dandaraga gold project.
Middle Island has executed the option deed by way of its 100 per cent-owned subsidiary company, Sandstone Operations Pty Ltd (SOPL), under which SOPL has the option to acquire the Dandaraga gold project, comprising granted Exploration Licence E57/1028, from SLS Exploration Pty Ltd.
The option deed requires payment of an initial option fee of $20,000, with the option to acquire a 100 per cent interest exercisable at any time within the next three years on payment of a further $200,000 in cash and/or MDI ordinary shares.
Dandaraga is situated 16 kilometres southeast of Middle Island’s Sandstone gold project and processing plant, and 4km south of the haul road from the Lord Henry and Lord Nelson deposits.
The Dandaraga project incorporates a series of historic gold workings that remain untested or poorly tested by modern gold exploration, of which the Agnes workings are developed on a zone of stockwork quartz veining within a dolerite unit, adjacent to which free gold has been identified in a highly brecciated, gossanous and quartzveined BIF.
Middle Island said the Dandaraga acquisition presents both an immediate and attractive open pit exploration target at the Agnes gold prospect, and consolidates considerable exploration acreage into the company’s Sandstone gold tenure.
The company considers the transaction to be consistent with its stated strategy to extend and enhance the proposed production schedule for the 100 per cent-owned Sandstone gold processing plant.
It will be the second such expansion, following the company’s recent option to acquire the Wirraminna gold project, situated immediately adjacent to the Sandstone project and within 1km of the processing plant.
“Dandaraga represents a second consolidation for Middle Island in the space of three months, again delivering an opportunity to extend and enhance the proposed production schedule for the Sandstone gold processing operation,” Middle Island Resources managing director Rick Yeates said in the company’s announcement to the Australian Securities Exchange.
“The Agnes prospect is considered to offer a significant, more immediate, exploration target, while extensions of the Agnes dolerite provide additional exploration upside, all of which can be readily and cost-effectively explored via conventional means.”