THE BOURSE WHISPERER: Stratum Metals (ASX: SXT) has signed two separate binding Heads of Agreement for the option to acquire, what the company described to be, ‘a unique portfolio’ of tenements located in the historic East Menzies Goldfield of Western Australia.
Stratum said proceeding with the acquisition will provide it with potential for early cash flow in relation to the historic Goodenough gold resource.
The company also anticipates the deal to provide it with significant exploration upside in an area containing the Granny Venn- Aunt Nellie open pit mines plus over 100 historic gold workings.
Source: Company announcement
“Stratum’s vision is to reward shareholders from the early stage production of our resource assets whilst continuing to explore our defined exploration targets,” Stratum Metals said in its ASX announcement.
“Stratum recognises significant potential for self-funded exploration and development based on generating cash flow from gold resources located proximal to supporting infrastructure.
“Successful acquisition of the East Menzies tenement portfolio will be based on Stratum identifying a clear low cost path to production and associated cash flow.
“The Board recognises significant potential in the proposed acquisition and will now commence extensive technical due diligence.”
In order to progress the Menzies consolidation and move to production Stratum said it will be looking to raise up to $5 million.
It expects to raise these funds through current shareholders, brokers and strategic investors, both domestic and from overseas.
“This project will give Stratum the opportunity to take a step up to producer status and provide a solid foundation for future growth,” The company said.
“We have the Board, management and strategic shareholders to support our strategy and we anticipate an active and rewarding year ahead for our shareholders.”