AuKing signs deal to acquire remaining interest in Koongie Park copper-zinc project
AuKing Mining is seeking to raise at least $6 million to fund earn-in and exploration commitments at Koongie Park.
AuKing Mining (ASX: AKN) has signed a $6 million deal with Anglo Australian Resources (ASX: AAR) to acquire the remaining 25% interest in the Koongie Park copper-zinc project in Western Australia, as well as the platinum group elements (PGE) rights across the project’s tenement package.
The acquisition will see AuKing secure a 100% interest in all the base metals, gold, silver, PGE and other minerals across the entire Koongie Park tenure.
It includes areas adjoining the Lamboo PGE deposit owned by Pantoro (ASX: PNR), where strong results have been reported such as 100m at 1.10 grams per tonne platinum-palladium-gold (3PGE), 0.38% nickel and 0.022% cobalt from surface, including 66m at 1.34g/t 3PGE, 0.44% nickel and 0.026% cobalt from surface; and 120m at 0.96g/t 3PGE, 0.30% nickel and 0.016% cobalt from surface, including 31m at 1.24g/t 3PGE, 0.23% nickel and 0.012% cobalt from 89m.
Historic soil sampling on nearby Koongie Park tenure has also demonstrated anomalous zones of platinum, palladium, nickel and cobalt, giving the company confidence that Pantoro’s mineralisation could extend into AuKing’s ground.
Earn-in joint venture
In early 2021, AuKing entered into joint venture agreement with Anglo which gave it the right to earn up to a 75% interest in Koongie Park by completing exploration expenditure of $3 million over a three-year period.
AuKing has since completed these commitments and currently holds a 75% interest in the joint venture.
During the same period, the companies entered into a separate precious metals agreement giving Anglo the exclusive right to explore and develop any gold and PGE discoveries across Koongie Park.
These rights will now pass onto AuKing as the new sole owner of Koongie Park, providing it with significant optionality and potential exploration upside.
Acquisition terms
Under the terms of the Koongie Park acquisition, AuKing will pay Anglo a total of $6 million in three instalments, starting with a $3 million payment in May.
It will be followed by $1.5 million in AuKing shares to be issued before the end of June, plus a final $1.5 million in cash by the end of October.
Completion of the purchase is subject to AuKing securing sufficient funding to enable it to complete the first payment and confirming that by mid-May.
The company is expected to conduct a rights issue to existing shareholders to raise most of the funds needed for the acquisition, accompanied by a strategic private placement to certain sophisticated investors.
Total ownership
Once the transaction is completed, AuKing will have secured total ownership of the Koongie Park project in less than 12 months from the start of the original earn-in agreement with Anglo.
AuKing has already established a strong foundation from which to continue significant exploration of the project, especially the existing Onedin and Sandiego deposits.
As sole owner of these assets, AuKing will be in total control of all future exploration and development activities.