PERTH (miningweekly.com) – Emerging gold producer Gold Road Resources has signed a joint venture (JV) exploration agreement with Sumitomo Metals Mining Oceania over the southern tenements of Gold Road’s Yamarna project.

By spending some A$8-million on exploration between now and the end of December 2016, Sumitomo could earn a 50% stake in the project. The Japanese major would have to spend a minimum of A$3.5-million prior to the end of 2014.

Gold Road’s executive chairperson, Ian Murray, said on Tuesday that securing this interest from an international mining company confirmed the prospectivity and appeal of the Yamarna greenstone belt.

He noted that the JV also complemented the company’s exploration and development strategy.

“Attracting a global mining company of Sumitomo’s history, experience and scale is a strong endorsement of the quality of exploration opportunity Gold Road has throughout its Yamarna greenstone belt, in Western Australia,” Murray said.

Sumitomo would earn an initial 30% interest in the project area by spending A$5-million, and could increase its stake to 50% by spending a further A$3-million prior to the end of 2016.

A budget of A$1.75-million had been established for 2013 to initially focus on regional targets previously identified. Exploration activities would start in May.

Murray noted that over the next 18 months, Gold Road would be focused on progressing its high-grade Central Bore project through to production, as well as exploring its northern tenements.

“Having an exciting portfolio of potentially world-class greenfields exploration targets to drill and assess is a rarity in the Australian gold sector,” he said.

“Through this transaction, Gold Road has made a conscious decision to bring forward the testing of some of these exploration targets on the southern portion of its tenements by several years, in order to give them the near-term attention they deserve.”

Murray added that the gold junior would retain 100% interest in the northern tenements, including the Central Bore project, the Attila gold resource, and the surrounding exploration opportunities.