Aurumin achieves debt-free status with completion of Mt Dimer sale and new placement

Aurumin (ASX: AUN) is now debt free after completing the sale of a number of assets and conducting a successful placement.

The company has successfully wrapped up the sale of its Mt Dimer mining leases and miscellaneous licences in Western Australia to Beacon Minerals (ASX: BCN) to help it improve its balance sheet as it focuses on other areas.

With the conclusion of the deal announced in mid-November, the company is receiving a cash consideration of $3 million. It is also eligible for a 2% net smelter return royalty on the Mt Dimer mining tenements on gold production above 12,000 ounces, and on all other minerals.

Managing director Brad Valiukas said Aurumin has already made good use of funds received from the sale, most notably reducing an outstanding balance of a convertible note held by Collins St Asset Management.

Aurumin has also made a further repayment of $0.363 million, reducing the outstanding balance of the note to $1.071 million as it closes in on removing the note from its books in the near term.

Positive placement support

As part of its solidification of its bank balance Aurumin has also received firm commitments for a placement to raise a total of $1.25 million to Collins St Asset Management, Middle Island Resources and 7 Enterprises.

“The combined transactions are a good outcome for Aurumin. The company is now net-debt-free and in a position to close out the remaining convertible note with available cash. In addition, we maintain upside from the Mt Dimer Mining Tenements, from future exploration and production,” Mr Valiukas said.

“The support from the board and existing shareholders, through 7 Enterprises and Middle Island, respectively, has been great during this process and in the completed placement. We are also pleased to welcome Collins St as a shareholder and appreciate their support in the placement.”

“I look forward to commencing the new year with a clean balance sheet and a clear focus on advancing our flagship 946,000 ounce Sandstone gold operations and generating the critical mass for future production.”

Sandstone offers significant upside

Aurumin recently significantly expanded the footprint of its flagship Sandstone project with the award of three new tenements.

The three newly granted tenements – E57/1294, E57/1302 and E57/1371 – are now part of the 881,000 ounces of gold central Sandstone project.

The associated Birrigrin and Johnson Range gold projects bring the total resource for Sandstone out to 946,000 ounces.

Aurumin’s acquisition of the central Sandstone project in early 2022 featured the Sandstone gold operations as its centerpiece.

The project includes significant project infrastructure and an expanding tenement footprint where the company aims to support a gold mining operation in the future.

Lightly explored opportunity

The new E57/1294 tenement adjoins the central Sandstone mining tenements to the north-east and contains the Hacks Creek structure running north-northwest through its length.

The lightly explored tenement has largely only been the target of first pass regional work to date, comprised of surface sampling and wide spaced reconnaissance drilling.

The E57/1302 and E57/1371 tenements build on the greenstone trend that hosts the Bellchambers, Bulchina and Golden Raven mineralisation.

In E57/1371 the historical Muriel Chapman mine was worked in the early 1900s and reported 106 tonnes at 15.1 grams per tonne for 51.5 ounces of gold.

The two tenements have only been explored by historical surface sampling work, although E57/1302 is largely untested by drilling with only six drillholes known to have been completed to date, while E57/1371 has had 22 historic first pass Rotary Air Blast (RAB) holes completed.