A NEW farm-in agreement struck with AngloGold by Striker Resources NL is the carrot directors of Striker hope will entice investors as it spins off its gold and base metal assets.
A NEW farm-in agreement struck with AngloGold by Striker Resources NL is the carrot directors of Striker hope will entice investors as it spins off its gold and base metal assets.
The farm-in agreement also puts an end to a legal dispute between Striker, AngloGold and De Beers.
Executive director and company director Kevin Hart said investors in the spin-off company, Napier Minerals Ltd, will benefit significantly from the joint venture agreement over an area in excess of 17,000 square kilometres in the east Kimberley region.
Mr Hart said besides the joint venture, Napier stood to benefit from Striker’s knowledge of the tenements. Striker will maintain a 50 per cent hold on the new company with 25 million, 20-cent shares, of which 10 million will be offered to current Striker shareholders.
The other 25 million shares are available to raise up to $5 million, giving the company a market capitalisation of $10 million on listing, which has been pencilled in for June 13 – two weeks after the offer is to close.
Mr Hart said Striker would refocus onto its diamond tenements.
In 2002, Striker spent around $1.2 million on gold exploration, including first-pass reconnaissance drilling. The tenements are divided into four principal project areas – North King George, King Edward, Fitzgerald and Oombulgurri.
AngloGold has agreed to spend a combined figure of $7.75 million in order to earn a 51 per cent interest on tenements covering 7,000 kilometres after an initial commitment of $600,000.
AngloGold will have the right to earn 51 per cent in the Oombulgurri Gold Project if it spends $5 million on exploration. De Beers will retain a 2 per cent net smelter royalty on any production from the AngloGold tenements.
Over the Casuarina tenements, covering 806 square kilometres, Napier will have a 29 per cent interest, AngloGold will gain a 51 per cent interest through exploration expenditure of $2 million, while Ellendale Resources NL will maintain a 20 per cent interest. A similar arrangement has been entered into with AKD Limited.
Net funds raised through the IPO are expected to reach $4.47 million after paying for the costs of the offer and will be used for further exploration, acquire additional strategic interests in other mining projects, repay the loan and acquisition costs owing to Striker and for working capital.
If fully subscribed more than $500,000 is budgeted for exploration over the next two years at King Edward, $1.25 million at King George and $625,000 at Fitzgerald.
Acquisition costs to be paid to Striker are $250,000 while a loan repayment of $305,000 is also to be paid to the parent company.
Besides Mr Hart, London-based former London Metal Exchange chairman John Wolff joins the new board as chairman, with Striker managing director Clayton Dodd as executive director.
Coyne Holdings Pty Ltd has been appointed as lead manager of the proposed offer.
Red Bank capital raising
RED Back Mining NL has announced a capital raising of $1.4 million through a share placement of 4.4 million fully paid ordinary shares at 32 cents per share to expand the issued capital of the company to 119.3 million shares.
The funds will be used for working capital for the Chirano Project in Ghana. Red Back is also considering a listing on the Toronto Stock Exchange or the London Alternative Investment Market.
Non executive director Tom Meiklejohn has announced that he is stepping down and has been replaced by Harry Michael. Previously Mr Michael was general manager of the Ashanti Goldfields Company Limited owned Idualpriem gold mine in Ghana.
