Kalamazoo Resources (ASX: KZR) has announced it is farming out its newly acquired Queens gold project in Victoria to Canadian-listed Novo Resources Corporation (TSX: NVO).
The company had added the exploration licence to its Victorian gold holdings last year as part of its move to capitalise on the growing drive to revive the state’s historic and rich goldfields.
The Queens ground adjoins Kalamazoo’s Castlemaine project in the central part of the state.
The project spans the highly prospective Taradale Fault and immediately surrounds the Malmsbury gold project owned by GBM Resources (ASX: GBZ) — and which project is also subject to a joint venture with Novo.
Queens is adjacent and to the east of Kalamazoo’s Wattle Gully South discovery in Victoria’s prolific Bendigo Zone.
Nova takes initial 50% of Queens
Novo has exercised its option to acquire 50% of Queens by issuing Kalamazoo $2 million worth of its own shares.
Novo can now earn a further 20% by spending $5 million over five years, and then move to an 80% stake by delivering a preliminary economic assessment.
Kalamazoo chairman and chief executive officer Luke Reinehr said Novo’s involvement with neighbouring Malmsbury provides obvious synergies for the two projects.
Novo president and chairman Dr Quinton Hennigh is also part of Kalamazoo’s technical team.
“This is a great opportunity to merge and apply our technical and regional skills to the existing Queens project,” Mr Reinehr added.
The Queens project and the greater Malmsbury goldfield have a known gold endowment.
According to Kalamazoo, Queens is considered prospective for Fosterville-style mineralisation, which references the large Fosterville mine in Victoria operated by Kirkland Lake (ASX: KLA).
Project remains under-explored
The Queens project includes part of the historic Malmsbury goldfield and contains numerous historical workings.
“Like the rest of the Castlemaine gold project, the Queens project is considered under-explored as it has not been subjected to modern exploration techniques with only limited shallow drilling,” Kalamazoo said.
Victorian goldfields were the world’s largest producers of gold for 30 years from 1860, accounting for more than half the global output.
Kalamazoo also owns the Ashburton gold project on the edge of the Pilbara Craton in Western Australia.