PERTH (miningweekly.com) – Junior White Rock Minerals has struck a A$30-million earn-in and joint venture (JV) option agreement with fellow-listed Sandfire Resources over its Red Mountain base and precious metals project, in Alaska.
Under the terms of the agreement, Sandfire could earn up to a 51% interest in the project by spending A$20-million on exploration over a four-year period, with a minimum A$6-million spend during the first year.
Sandfire could then elect to increase its interest in the project to 70% by sole-funding a further A$10-million and delivering a prefeasibility study within a further two-year period.
At this point, White Rock could either elect to contribute its 30% share of expenditure, or could allow Sandfire to sole-fund definitive feasibility studies in exchange for a further 10% interest in the project.
Should White Rock not elect to contribute to the development of the project, Sandfire could be required to sole fund this expenditure for an additional 10% interest in the project, taking its share to 90%, with White Rock to repay 10% of the total development expenditure to Sandfire from 65% of its share of the project cash flow.
White Rock MD and CEO Matt Gill said on Monday that securing a partner like Sandfire, with world-leading expertise in exploration and development of base metals projects, was a strong endorsement of the quality and potential of the Red Mountain project.
“It is significant for White Rock shareholders that the terms of the agreement with Sandfire provide a funding pathway to advance the Red Mountain project through exploration to the point of advanced development studies and allow White Rock to retain a 30% interest in any project development at the point when the economics of a project are well defined by a prefeasibility study.”
The Red Mountain project consists of some 475 km2 of tenements covering numerous historic volcanogenic massive sulphide prospects with little modern exploration.