With exploration underway at Mulga Tank, Western Mines Group (ASX: WMG) has grown its portfolio further with the acquisition of key ground adjacent to its Jasper Hill gold project in Western Australia.
The company has executed a binding agreement to purchase the neighbouring tenement to Jasper – consolidating its position over 3km of mineralised trend on the underexplored Merolia Greenstone Belt.
Large open pit workings have been identified over the new tenement, which the vendors had mined themselves.
The vendors had transported mined ore to Leonora or Laverton for processing in the 1960s and 1980s.
Western Mines managing director Caedmon Marriott said the new landholding was an “exciting piece of ground” that consolidates the Jasper Hill project.
He said the 3km mineralised trend has only been “lightly drilled” with no real follow up work since the 1980-90s.
“We look forward to getting out on the ground and ramping up work at what is now our primary gold project,” he added.
In consideration for the tenement, Western Mines is paying the vendors $50,000 in cash and issuing 350,000 million ordinary shares.
Western Mines is also issuing 700,000 options with three-year expiry and exercise price of $0.30 each.
The vendors will receive a 1% net smelter royalty for any minerals extracted from the tenement.
A 21-day due diligence period applies before the acquisition is formalised.
Jasper Hill gold project
Jasper Hill is about 80km southeast of Laverton and about 50km from Western Mines’ other gold project Rock of Ages.
The Merolia Belt can be traced over 110km from the Burtville Mining Centre.
Jasper Hill is partly under shallow cover which has likely deterred previous exploration efforts.
However, Western Mines noted the project is contiguous to nearby gold mines of Lord Byron and Fish.
These deposits were mined between 2010 and 2012 and have a combined remaining resource of 156,000 ounces of gold at 1.9 grams per tonne.