Legend Mining (ASX: LEG) has inked deals with fellow Australian explorer Independence Group (ASX: IGO) and private company Creasy Group for three new joint ventures over its Fraser Range tenement holdings in Western Australia.
In an announcement today, Legend outlined one joint venture agreement (JVA) with Independence over three Fraser Range tenements, another deal with both Independence and Creasy over parts of Legend’s Rockford nickel-copper project, and a third deal with Creasy relating to new areas contiguous with the existing Rockford project.
In addition, Legend has signed a two-tranche subscription agreement with Independence at an issue price of $0.036 per share to raise $9.8 million.
This deal, which is priced at a 20% premium to the company’s average 2019 share price, will result in Independence becoming Legend’s second largest shareholder with an 11.9% stake.
Ponton joint venture
The first deal signed between Legend and Creasy is being called the Ponton JVA and comprises two tenements on the western margin of the Fraser zone within the larger Albany-Fraser Orogen.
The tenements, which cover 709sq km and contain two advanced nickel-copper prospects, Octagonal and Magnus, are contiguous with Legend’s existing Rockford project area.
In order for Legend to acquire a 70% stake in the tenements, it will issue Creasy 55.55 million Legend shares at $0.036 per share (almost $2 million).
In addition, Legend will be required to issue Creasy with an additional 277.77 million shares at $0.036 per share ($10 million) upon completion of a bankable feasibility study and decision to mine.
Legend will be expected to solely fund exploration and free-carry Creasy’s 30% interest through to the signing of mining venture agreements (following completion of the BFS and decision to mine).
Under the terms of the deal, Legend will also drill a 2,000m diamond hole into the Octagonal prospect within the first 12 months.
The completion of this JVA is conditional upon shareholder approval, as well as Legend completing the $9.8 million capital raising.
The latter condition is expected to be satisfied following shareholder approval of tranche two of the placement to Independence, anticipated in October.
Rockford joint ventures
Under a second deal known as the Rockford JVA, Independence has snapped up a 60% stake (plus management rights and responsibilities) over two Rockford North tenements with Creasy and Legend holding free-carried interests of 30% and 10%, respectively.
In a third deal, the Legend/IGO JVA, Independence will acquire a 70% interest in three of Legend’s wholly owned tenements just above the Rockford project area, with Legend being free-carried for a 30% stake.
Legend managing director Mark Wilson described the agreements as “transformational” and said securing this funding was “an important outcome” for the company’s shareholders.
“It has been possible due to the new joint venture with Creasy over 709sq km of ground, which has known nickel-copper sulphide mineralisation at the Octagonal prospect within the new joint venture,” he said.
“The added dimension to the transaction is the additional joint ventures with Independence over the northern Rockford area, which will give new technical impetus to our exploration efforts,” Mr Wilson added.
“These transactions demonstrate a common goal between the three parties to unlock further value in the fertile Fraser Range,” Creasy founder and prospector Mark Creasy added.
Independence chief executive officer and managing director Peter Bradford said his company looked forward to working closely with Legend’s exploration team “to drive discovery success at Rockford”.
“Legend’s mineral exploration holdings in the Fraser Range are extensive and are highly prospective for magmatic nickel-copper-cobalt sulphide deposits, with numerous prospects already identified,” he said.