Emmerson Resources has entered into a binding agreement with Ivanhoe Australia in relation to the formation of an exploration Farm-In and Joint Venture (JV) to fast track the discovery of deposits within its 100%-owned tenements at Tennant Creek, Northern Territory.
The agreement secures the involvement of the mining company to advance the large number of gold-copper targets identified by Emmerson within its tenement package, and fast track the discovery of a new generation of Tier 1 gold and gold-copper deposits in the Tennant Creek Mineral Field (TCMF).
“Under the terms of the agreement Ivanhoe will sole fund expenditure of $18 million on exploration over a three year farm-in period to earn a 51% interest in the majority of Emmerson’s tenement package at Tennant Creek, Ivanhoe must spend a minimum of $7.5 million during the farm-in period however does not earn any equity until it meets expenditure of $18m,” Emmerson Resources said.
After completing the farm-in Ivanhoe must sole fund an additional $10 million on exploration within a 5 year period to maintain their 51% interest in the tenements.
• Ivanhoe must sole fund projects over 500,000 oz Au Eq to earn a 70% interest upon these projects reaching a minimum 1 Million oz Au Eq hurdle. Any Tier 2 projects identified within the Joint Venture Area with less than 250,000oz gold equivalent will be retained by Emmerson for sole funding and potential development using Emmerson’s 100%-owned Warrego CIP gold treatment facility, which is currently on care and maintenance.
• Additionally, at any stage of the Farm-In or JV, Emmerson can “sole risk and sole fund” projects that are not being explored by the JV, however if any exceed the 250,000oz gold equivalent hurdle, Ivanhoe has a “clawback” option.