THE BOURSE WHISPERER: Mutiny Gold has secured 100 per cent ownership of the Widgie South tenement.
The company settled the acquisition for a combined $200,000 comprising a $100,000 cash payment and the issue of shares to the value of $100,000.
The company considers the Widgie South Project to hold excellent potential to contribute to its pipeline of projects, once first production from the Deflector deposit has commenced.
Widgie South nickel project – geological map. Source: Company announcement
“We’ve elected to negotiate a settlement of the Widgie South Joint Venture, given that at the moment the company is 100 per cent focused on getting the Deflector deposit into production,” Mutiny Gold managing director John Greeve said in the company’s announcement to the Australian Securities Exchange.
“With buying the Widgie South tenement outright the company retains a keen future interest in the tenement and obtains control of the exploration prospect with the option to develop, Joint Venture or sell the tenement at a future point in time that suits Mutiny and our strategic growth objectives.”
Under the farm-in agreement announcement in February, Mutiny was obliged to spend $300,000 to earn a 51 per cent stake in the tenement with the option of spending another $700,000 to increase that to 80 per cent.
The Widgie South nickel sulphide project is situated within the Widgiemooltha district and lies entirely within an exploration licence located on the northeast edge of the Widgiemooltha Dome, an area Mutiny said hosts a large number of promising nickel projects.
The Widgiemooltha area has produced nickel mines, including the Miitel mine, which has produced over 47,000 tonnes of nickel, the Mariners Mine with over 28,000 tonnes nickel in resources at a grade of four per cent nickel and Redross with production of 12,453 tonnes nickel (compiled from historical data).
Mutiny’s confidence the project it is farming into is highly likely to host economic resources of nickel stems from the success of these deposits within the immediate area of Widgie South.
Mutiny recently completed a follow-up TEM survey during the June 2010 quarter.
The company said this survey confirmed the conductor defined by the initial survey has a steep dip and is confined to Mutiny’s tenement.