Solstice Minerals generates $10m from sale of Hobbes exploration licence
Solstice Minerals (ASX: SLS) is set to add $10 million to its bank balance after entering into a binding agreement for the sale of an 80% interest in the Hobbes exploration licence in Western Australia.
Northern Star (Carosue Dam), a subsidiary of Northern Star Resources (ASX: NST), has also reached an agreement to acquire the remaining 20% in the Hobbes licence from an unrelated private company.
The Hobbes exploration licence contains the Hobbes gold deposit located near Northern Star’s open-pit and underground gold mines at Porphyry and its Carosue Dam production hub.
The Carosue Dam operations (CDO) includes the Carosue Dam, Porphyry and Deep South projects.
Northern Star acquired the original CDO assets in 2006 and commenced commercial gold production in 2010.
Recent discovery
A fairly recent discovery, Hobbes is estimated to contain an inferred mineral resource estimate (MRE) of 4.6 million tonnes at 1.2 grams per tonne gold for 177,000 ounces of gold.
With the exploration licence located just 5km southwest of the Porphyry mining centre, near established mining and haul road infrastructure, it is an ideal target for a future potential expansion of Northern Star’s operations in the area.
It is expected that the deposit, which sits under approximately 40m of barren material, will be most efficiently progressed via Northern Star’s nearby infrastructure.
Exploration plans
Solstice said the completion of the sale will add $10m to its $8.2m cash balance to underpin the search for new “blind” gold deposits across the company’s extensive Yarri Project and other landholdings.
The company recently discovered Hobbes’ gold mineralisation via aircore drilling reasonably late in the exploration process as it had been hidden under transported cover.
The company believes there is potential to locate new mineralisation in similar structural positions elsewhere in its Yarri tenure and this has been the focus of exploration work since the reporting of the Hobbes MRE.
The company said it will now concentrate its efforts on new prospects within and around the Yarri gold project, Ringlock Dam and the Ponton project, as well as assess new commercial opportunities that can add value for shareholders.
Solstice commenced aircore drilling at new Yarri gold targets in early February, testing under cover prospects.
The drilling followed up open gold anomalism in historical aircore holes at Wallbrook South and tested unexplored structural targets at Edjudina Range and Boyce.