Last week, Small Caps reported De Grey Mining’s stock had gone through the roof after it announced it had discovered a new outcropping gold conglomerate within the Indee gold project area (part of the Pilbara gold project) in Western Australia’s Pilbara.
These latest announcements shore up De Grey Mining’s position within the Pilbara and Kirkland Lake Gold’s $5 million investment brings De Grey Mining’s coffers up to $8 million and will fund the company’s exploration activities for another 18 months.
Dual-listed mid-tier gold miner Kirkland Lake Gold has stock on the Toronto and New York stock exchanges and a market capitalisation of US$2.7 billion (A$3.45 billion) and gold assets in Canada and Australia.
Less than a month ago, Kirkland Lake Gold bought into WA’s Pilbara gold rush by purchasing a CAD$56 million (A$57 million) stake in TSX-listed Novo Resources which is farming into the renowned Purdy’s Reward gold prospect, near De Grey Mining’s latest gold find.
De Grey Mining executive chairman Simon Lill said the company was looking forward to Kirkland Lake Gold’s added assistance in developing its Pilbara gold project.
Extension to Indee gold transaction
In another strategic move to cement its Pilbara position, the extension to the Indee gold project acquisition buys De Grey Mining up to 12 months more time to raise the $14.9 million purchase funds while continuing exploration activities at its Pilbara gold project.
Under the original agreement, De Grey Mining was to pay Northwest Non Ferrous Australian Mining (NNAM) $14.9 million by July 2018, but this has now been extended up to July 2019. In the revised contract, NNAM will also accept $3 million in De Grey Mining stock as part of the payment terms leaving De Grey Mining to come up with the remainder in cash.
The market reacted favourably to these announcements, with De Grey Mining shares up more than 55% in early afternoon trade. In one month, De Grey Mining stock has sky-rocketed almost 243%.
This has been a similar story recently for other junior explorers taking part in the Pilbara gold rush.